Pakistan and Afghanistan not only share a 26000 KM long border, but also shares, common, cultural, ethnic, and religious ties. Although Afghanistan is a landlocked state, it is an agricultural state like Pakistan. Fresh fruits and vegetables are the most important sector of Afghan agriculture. Being a neighbor of Pakistan strong relations between the two countries are needed of the hour especially trade and economic relations. Trade and economic relations are the main steps towards strengthening ties. For enhancing cooperation, Pakistan is taking every step to give easy access to its market Afghan goods.
In the past different initiatives taken by Pakistan and Afghanistan for enhancing trade relations. In 1965 the first Afghanistan Transit Trade Agreement (ATTA), was signed between the two countries, which guaranteed the freedom of transit trade for both countries. Afghanistan and Pakistan first established the Pak-Afghan Joint Economic Commission (JEC) in 1992. In 2010 for the enhancement of economic activities, both countries signed the Afghanistan Pakistan Transit and Trade Agreement (APTTA).
There are five fully operational border crossings between the two countries for trade activities and for people movement. A large number of Afghan refugees cross daily into Pakistan.
During the last 17 years, the exports of Afghanistan to Pakistan have increased at an annualized rate of 17.9%, from $29.9M, in 2003 to $492M in 2020. In 2020, Pakistan exported $870M to Afghanistan. Since the Taliban takeover in Kabul, Afghan exports to Pakistan has increased and Pakistan’s export to Afghanistan dropped. Pakistan has increased its bilateral cooperation with Afghanistan and given trade-related concessions to Afghanistan because the war-torn country is facing a severe economic and humanitarian crisis.
Pakistani official, who deals directly with bilateral Afghan matters said “We have allowed Afghan importers to buy our products in Pakistani currency and have given them the freedom to export any items to Pakistan to facilitate bilateral trade,”. He described that the government of Pakistan has a plan to establish new crossings on the border to further facilitate commercial activities as well as visitor movement.
The Afghan fruit and vegetable exports to Pakistan have increased since the Taliban take over and the sales tax on Afghan fruits is zero. Pakistan wants to enhance trade relations with Afghanistan and has taken important steps to boost bilateral trade. Afghan Foreign Ministry spokesman “Abdul Qahar Balkhi said in a statement that the ministry welcomes the steps taken by Pakistan and called for an increase in trade between the two countries”. Pakistan has increased coal imports from Afghanistan in the wake of rising global prices.
Despite economic challenges, Pakistan is not only providing economic and humanitarian assistance to Afghanistan but also demanding to the world to provide more economic and humanitarian assistance to Afghanistan and release its frozen assets. Pakistan has convened the conference of Foreign Ministers of the Organization of Islamic Countries (OIC) in Islamabad to address the Afghan crisis.
Pakistan urged the Afghan gov’t to join the China-Pakistan Economic Corridor (CPEC). It will provide good opportunities, infrastructure, and energy connectivity between Afghanistan and Pakistan. It is a central part of the Belt and Road Initiative, which will link Asia with Central Asia, then Africa and Europe.
No country in the world has recognized the Taliban regime yet and Pakistan is urging the world to recognize the Taliban gov’t to save the humanitarian disaster in Afghanistan. At the moment Afghanistan is on the verge of collapse and the Taliban gov’t needs world recognition. As Afghanistan is considered a gateway to Central Asian countries, the mutual economic and trade relations between the two countries would be fruitful for Pakistan to get access to central Asian countries and it will help Afghanistan to connect with South Asian countries through Pakistan.
The strong trade relations between the two countries will boost domestic employment as well as provide foreign exchanges. Afghan officials see Pakistan as a key market for Afghan goods but they face hurdles in achieving their goal because of the Afghan hostile attitude towards Pakistan. In the Past Afghan gov’t gave preference to India rather than Pakistan and their exports to India were higher than Pakistan.
Now both countries should try to build mutual trust and cooperation in all fields which are in the interest of both countries for achieving economic progress. They should make business-friendly policies, barter trade mechanisms, and effective investment and joint venture policies and should remove all hurdles which are in the way of bilateral trade and relations. Pakistan should also need to expand its business activities in the Afghan market. Both countries should make free trade agreements and rail networks for transportation which is low cost than road transportation. Easy excess of Visa mechanism should be launched for skilled persons, the business community, and traders. No doubt Pakistan is the best market for Afghan goods and Pak-Afghan Trade is a remedy to the Afghan financial crisis. There is a need for mutual understanding for making better and strong ties.
