Pak-Afghan trade slips to $720.4mln in July-January

KARACHI: Pakistan-Afghanistan trade fell seven percent to $720.4 million in the first seven months of the current fiscal year of 2019/20 as exports to neighbouring country showed a downward trend, the central bank’s data revealed.

The State Bank of Pakistan’s (SBP) latest data showed exports to Afghanistan declined to $633.1 million in the July-January period of FY2020, compared to $676.2 million in the corresponding period a year earlier. Imports, during the period, slid to $87.2 million from $98.7 million.

In January, exports to Afghanistan sharply fell to $89.9 million compared to $141.5 million in the same month a year earlier and $110.5 million in December last year. Monthly imports also decreased to $9.4 million in January from $13.5 million in the corresponding month a year earlier and $16.6 million in December 2019.

The landlocked Afghanistan depends on products’ inflows from Pakistan to meet its consumer needs. Pakistan is also used as a transit corridor for supply to the neighbouring country, fetching revenues for the tax authorities.

However, the cross-border trade slowed in the recent past due to strict monitoring and increasing cost of transit and bilateral trade, according to a last month’s report by a state-run Trade Development Authority of Pakistan (Tdap).

Tdap report said a key concern for the stakeholders is higher transit cost with Afghanistan that is shifting to other neighbouring countries like Iran that offers competitive rates, better consignment handling facilities and cost-effective transportation.

“High cost of transportation and hefty deposits by shipping companies for transportation containers are discouraging Afghan importers to deal with Pakistan,” the report added.

The government reopened its border with Afghanistan on Saturday to permit the entry of trucks carrying food and essential goods under the Afghan transit trade.

Around 10,000 containers of Afghan transit trade land at Pakistan’s port every month. The Chaman border was closed on March 3 stranding 1,600 vehicles en-route. Torkham border was closed on March 16 and 400 more vehicles were stranded.

The instruction of border reopening was also issued a couple of months back. But, thousands of transit trade containers were seen stuck at port and roads bordering Afghanistan.

“Not a single transit trade vehicle could cross into neighbouring country due to procedural lapses,” Shams Burney, chairman of All Pakistan Customs Bonded Carrier Association said in a statement.

“Around 2,100 containers of Afghan transit trade were on the road, while around 6,000 containers were stuck at the port.” Burney said around two dozen vehicles carrying export goods were allowed to cross into the Afghanistan after the Prime Minister Imran Khan twitted reopening of Afghan border. He said drivers going into Afghanistan are said to be kept in quarantine for 14 days on their return to prevent spread of coronavirus outbreak. “Drivers are now very much reluctant to go into the neighbouring country.”

Now, 2,100 vehicles carrying reefer containers, edibles and all other commodities are awaiting clearance. Approximately 6,000 containers are stuck at ports.

Customs authorities block the national tax number (NTN) of bonded carriers that fail to cross border within 14 days. “Now, NTNs of almost all the bonded carriers are blocked.”