PESHAWAR, Dec 4: Growing volume of Afghan Transit Trade (ATT) has given rise to apprehension among the trade and import business circles here as they feel that the unchecked import of foreign goods for Afghanistan entails negative impact for the country's manufacturing sector and revenue base.
Information gathered from trade and import business circles revealed that the people associated with the smuggling business are getting ready to hit again under the garb of ATT.
Trade and business circles have seen the ATT growth as detrimental to the legal import business as more and more importers, according to market sources, are switching over to the business of importing goods for Afghanistan.
"The balance is fast titling towards ATT as local and Afghan importers have started diverting more and more investment towards the transit trade," said Mr Arooj Ansari, a Peshawar-based customs clearance agent.
According to official sources, the ATT has shown substantial growth during the past one year after the removal of several items from the negative list, which had been put in place during the last Nawaz Sharif government and amended from time to time to curb smuggling of foreign goods to Pakistan.
Goods valuing Rs4.8 billion customs duty were transported to Afghanistan under the ATT via Torkham in 2001-02. Whereas, in the 2002-03 goods of the total value of Rs5.2 billion were imported for the war-torn country under ATT via Torkham.
The trade started picking up in the 2003-04 financial year when it registered substantial growth as goods involving customs duty of Rs7.8bn were imported by Afghanistan through ATT via Torkham.
Official sources told Dawn that the volume of ATT had undergone much larger increase during the on-going financial year as several of the local importers who had given up the import of foreign goods under the ATT because of the expanding negative list had again started doing business for Afghanistan.
"I have also resumed business with Afghanistan under the ATT after being badly hit by the Central Board of Revenue's recently changed rules," said a leading importer of crockery and glassware.
Customs clearance agents also said that they had started losing business to ATT because of the CBR's move of levying higher tariff on foreign goods, which are being cleared from the customs dry port at Peshawar.
They said that earlier CBR was used to charge lower tariff against the goods cleared from the Peshawar dry port. The incentive was meant to facilitate local importers and encourage more and more traders, from the tribal areas, to give up their smuggling business and start importing foreign goods through legal channels.
"As the incentives have recently been withdrawn the people, particularly belonging to the tribal areas, have gradually started running their businesses on the old lines," said a tribal importer.
Mr Ansari said that the government would need to make border security apparatus effective to ensure that goods imported for Afghanistan under the ATT did not end in Peshawar's market, as had been the case in the past.
"This would really be a difficult task for the government because it has never been successful in curbing smuggling from across the border except for the last time when it put in place negative list in an effort to stop import of those goods, under the ATT, which the people of Afghanistan do not need at all like air conditioners, black tea, etc.," said Mr Ansari.
Though the government of Afghanistan, he maintained, had raised the rate of its taxes on imported goods and the cost of smuggled foreign goods to Pakistan had also escalated considerably in the recent past, Islamabad has completely failed curb smuggling from the country's western borders.