December 6, 2003	Saturday	Shawwal 11, 1424

KARACHI, Dec 5: Islamabad wants Kabul to levy tariffs on import of goods that are transported through Pakistan’s transit facilities so that these goods are rendered financially unviable for being smuggled into Pakistan.

Trade sources close to government disclosed that Afghanistan has expressed desire to re-route its transit imports via Iran port Bunder Abbas through Pakistan. Transit import through Iran is expensive for Kabul because of the distance involved. But the most pressing issue is the Herat administration which collects, according to a report, as much as $500 million custom revenue from this merchandise, but does not pass on this collection to Kabul.

A former Pakistan’s foreign secretary Najamuddin Sheikh in one of the articles published in Dawn on August 27 last estimated smuggling of goods worth $5 to $6 billion from Afghanistan to Pakistan. Trade sources estimate ATT imports via Iran at about $2 billion while Pakistan offers transit facility to imports worth about $350 to $400 million every year.

Imports under Afghan Transit Trade (ATT) had been a problem for Pakistan’s domestic industry for the last several years. Islamabad had been short listing the ATT import items to check illegal inflow of goods, prevent revenue haemorrhage and also to safeguard national industry.

But lately, the Afghan government has invoked the relevant international convention that guarantees unhindered flow of goods for the land-locked countries. “We are ready to offer all assistance to boost Afghan trade, but we seek protection for our industries”, a Karachi based businessman told Dawn. He said the proposal to levy a tariff on goods imported through transit facilities is a fiscal measure to make smuggling of such goods unviable.

Pakistan has already offered technical assistance to Afghanistan in preparation of a custom tariff in Darri language to the Afghan government.

According to the trade sources these issues were due for discussion in the Pak-Afghan Joint Economic Council (JEC) meeting. This JEC meeting was earlier scheduled in second week of December at Kabul. This meeting has now been put off because of the Loya Jirga elections are now underway. Trade sources expect this meeting now to be held sometimes in January.

Meanwhile, the chairman of Pakistan Railway Board is holding a meeting of senior officials of Finance Ministry, Dry Port authorities and businessmen on Saturday in Islamabad to discuss the issues involved in Pak-Afghan trade.

Pakistan is setting up a dry port warehouse facility outside Peshawar for all Kabul-bound imported cargo.

In the last Pak Afghan JEC meeting held at Islamabad, Pakistan government decided to open a third trade route for Afghanistan. The existing two trade routes are Peshawar-Jalalabad road and Chamman-Kandhar Road. Pakistan is opening a third route through Ghulam Mohammad Khan village. This is being done to meet the increasing volume of trade between the two countries.

Trade sources say that Afghanistan has cut down its imports from Malaysia, Singapore and Indonesia and now depends on Pakistan for supply of a variety of goods. Cement, construction material, food items and other variety of items are being transported to Kabul and Kandhar. Finance Minister Shaukat Aziz estimates Pakistan’s exports to Afghanistan — formally and informally — amounts to well over $400 million a year.

Traders fear that after resumption of flights between India and Pakistan that would also facilitate India to overfly Pakistan and reach Kabul directly in less time could hurt Pakistan’s trade interests. There is a lurking fear that India may seek a direct over land transportation route through Pakistan to Kabul which is fraught with dangerous political

and economic consequences.

Saturday in Islamabad to discuss the issues involved in Pak-Afghan trade.

Pakistan is setting up a dry port warehouse facility outside Peshawar for all Kabul-bound imported cargo.

In the last Pak Afghan JEC meeting held at Islamabad, Pakistan government decided to open a third trade route for Afghanistan. The existing two trade routes are Peshawar-Jalalabad road and Chamman-Kandhar Road. Pakistan is opening a third route through Ghulam Mohammad Khan village. This is being done to meet the increasing volume of trade between the two countries.

Trade sources say that Afghanistan has cut down its imports from Malaysia, Singapore and Indonesia and now depends on Pakistan for supply of a variety of goods. Cement, construction material, food items and other variety of items are being transported to Kabul and Kandhar. Finance Minister Shaukat Aziz estimates Pakistan’s exports to Afghanistan — formally and informally — amounts to well over $400 million a year.

Traders fear that after resumption of flights between India and Pakistan that would also facilitate India to overfly Pakistan and reach Kabul directly in less time could hurt Pakistan’s trade interests. There is a lurking fear that India may seek a direct over land transportation route through Pakistan to Kabul which is fraught with dangerous political and economic consequences.