Pak-Afghan trade takes backseat owing to Pakistan’s absurd policy changes, tariff hike

World

According to media sources, despite several bilateral conversations, Pakistani government’s nonsensical import policy changes and tariff increases have prevented trade between Pakistan and Afghanistan from developing to its full potential.

For instance, the State Bank of Pakistan’s (SBP) new export policy required payments from Afghan customers to be made in US dollars, which caused issues for several months. According to Financial Post, the Khyber Chamber of Commerce, Torkham Custom Clearing Agents Association, Khyber Pakhtunkhwa Commercial Exporters and Exporters, and Cargo Transport Association boycotted the clearance of commercial goods destined for Afghanistan for a number of days in protest of this policy.

Pakistani businesses and transporters expressed their displeasure with the current payment system, claiming that when the Taliban took power in Afghanistan in 2021, no official banking was still operating there.

The agitated businessmen requested that the Pakistani government let imports into the Pakistani Rupee from Afghanistan (PKR). However, the Pakistani government resisted taking a position on the matter for a very long period. Unfortunately, the dealers had already suffered significant losses in transaction volume by the time the Pakistani government permitted payment in PKR, according to the Financial Post story.

In addition, Pakistan has increased the duties on the import of fruits from Afghanistan, which is another unfair practise. Farmers in Afghanistan accuse Pakistan of yearly raising the customs fees on fresh fruit.