ISLAMABAD, Dec 11: The government has decided to set up a dry port at Mirpur in Azad Jammu and Kashmir (AJK) to facilitate importers and exporters, a senior official told Dawn on Tuesday.

The federal government has directed the Central Board of Revenue (CBR) to select the site for the proposed customs port shortly.

The CBR has also been asked to work out the requirement for the port along with the staff required to carry out work in consultation with the ministry of Kashmir Affairs and Northern Areas.

Mirpur, the industrial capital of AJK, has become the hub of trade activities, as all the industries were installed there because of over a decade-long tax holiday. The main produce of the industries are cosmetics, mattresses, sugar, cement and Vespa motorcycles, etc.

It is worth mentioning that recently the government has established a similar customs port at Sost situated on Pakistan- China border to facilitate trade between the two countries.

The project was initiated at the request of the ministry of KANA and it will facilitate the exporters and importers in the clearance of their goods.

An official source in the ministry of KANA told Dawn that the work on the proposed dry port was delayed because Pakistan and Kashmir governments had differences over the collection of duties at the port. This issue that who would collect the duties— Pakistan or Ajk—has not been resolved, the sources said.

Pakistan claims that it gives Rs2 billion annual grant to the Azad Kashmir government as such it has a right to collect the duties.

According to the sources, there is a possibility that Pakistan government would allow the AJK government to collect the duties but make it mandatory for the state government to adopt the same duty structure as applicable in Pakistan.

The sources said the AJK government is already planning to amend its constitution to collect the duties.