Thursday, June 1, 2023

Pakistan export to Afghanistan decreased since the Taliban takeover

Since the Taliban seized control of Kabul in August, the flow of Afghan transit trade, as well as Pakistan export to Afghanistan, have both decreased significantly.

Since last year, the flow of cargo has decreased by 16 percent in August 2021 and by another 73 percent in September, which many analysts blame for the uncertainty that has followed the Taliban’s takeover of Afghanistan in late October.

According to official data, the flow of freight decreased by 73 percent to 4,212 containers in September 2021, compared to 15,846 containers in the same month the previous year. The number of containers moved decreased to 7,864 containers in August 2021 from 9,312 containers the previous year, a decrease of 16 percent.

In the last few years, Pakistan has been able to reclaim a significant portion of the Afghan transit trade. The flow of transit cargo increased by 169 percent in April 2021, followed by an increase of 115 percent in May, a 32 percent increase in June, and a 60 percent increase in July.

In addition, the assessed import value of transit cargoes decreased by 71 percent to $130.7 million in September 2021, compared to $444 million the previous year. Similar trends were observed in August, with the value of transit cargoes imported falling to $273 million from $319 million in August of the previous year, a 14 percent decrease.

Because of the instability in Afghanistan, according to several experts, commercial imports through transit trade have decreased significantly since August. Torkham and Chaman border stations are the points of entry for transit freight into Afghanistan.

Torkham, in the Khyber Pakhtunkhwa province, has traditionally been one of the most important border crossing places for freight transit. In the past few years, there has also been a noticeable decline in the volume of commercial cargo passing through the border post. According to the data, transit importers have picked Chaman as a new destination until the fencing in the Balochistan province has been completed.

As stated by a customs officer, the decrease in the number of commercial containers at the Torkham border is thought to be one of the consequences of the fencing of the border with Afghanistan, which has made it impossible for smugglers to re-enter transit goods in the KP parts of the country. However, there has been no formal confirmation of this claim yet.

At the same time, the volume of bilateral commerce decreased during the first two months of the current fiscal year when compared to the same period the previous year. During the months of July and August 2021, the value of Pakistan’s exports to Afghanistan was $95.672 million, compared to $123.785 million during the same months of the previous year, suggesting a 22.7 percent decrease.

On August 15, the Taliban seized control of Kabul and declared themselves the sole rulers of Afghanistan.

During the Taliban’s inaugural press conference, spokesperson Zabihullah Mujahid stated that the Taliban will continue to trade with neighboring countries. He stated that initiatives would be done to encourage trade. The data, on the other hand, did not support his claim.

The increase in imports from Afghanistan, in contrast to the fall in exports, has been noticeable in the first two months of the current fiscal year, according to official data. The value of imports from Afghanistan reached $18.960 million in July and August 2021, compared to $9.514 million in the same months the previous year, representing a rise of more than 99 percent.

As a result of Islamabad’s policy to maintain commerce with Kabul while also providing additional facilitation, such as the removal of duties on the import of fruits from Afghanistan, an increase in imports from Afghanistan has occurred.

The comparison of imports for the pre-Taliban period (July 1 to August 15) and the post-Taliban period (August 16 to September 30) at the Torkham border reveals a 142 percent rise in import value, from Rs6,757.09 million to Rs16,373.67 million during the pre-Taliban period.

The overall number of imported automobiles registered increased by 160 percent, from 9,117 vehicles to 23,698 vehicles, from the previous year. It demonstrates that the movement of trucks across the border increased after the Taliban took control of Kabul by putting an end to the practice in which Afghan police and transport ministry officials posted on the Afghan side demanded between 10,000 and 25,000 Afghanis in exchange for allowing their trucks to return to Pakistan after they were captured by the Taliban.

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