Khyber Pakhtunkhwa

Pakistan exports to Afghanistan declined significantly under Taliban rule

Pakistan exports to Afghanistan declined significantly under Taliban rule

PESHAWAR: Pakistan exports to Afghanistan are on constant decline after the Taliban takeover as import orders have been cancelled due to non-availability of funds and closure of country’s construction sector.

Traders said that cement makes up to 40% of Pakistan’s total export to Afghanistan but because of strict border management mechanism and other hurdles, the export has reduced to zero. One of the reasons behind the decline is also the easy availability of construction material, such steel and cement, in Afghanistan from central Asian countries.

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Shahid Hussain, a member of Board of Directors of the Pak-Afghan joint Chamber of Commerce, said that construction materials, especially cement, exports make a large part of Pakistan’s exports to Afghanistan.

Hussain added that Pakistan’s exports have fallen from 70% to 20% since the Taliban takeover on August 15 mainly due to closure of banks in Afghanistan. He added that in the past one week, cement exports have reduced to zero as Afghans are unable to make payments because of their Bank’s closure.  

According to Hussain, because of the closure of cash counters, the traders have requested to ease restrictions on Pak-Afghan trade which has been severely affected due to the current sanctions. He further said that earlier traders used to deposit US dollars at cash counters and in return they would get Form (E) and Form (I) from State Bank of Pakistan which is now closed. Because of its closure, traders are working on booked orders. He said that due to this issue, Pakistani cement export has declined to almost zero.

According to sources, the reason for the government’s ban on the construction sector in Afghanistan is the closure of Afghan banks, from which people are being provided only money for their daily lives.

The FF Steel owner Zarak Khan said that Pakistan export to Afghanistan is stopped for the last ten years due to availability of cheap steel from central Asia countries. Khan further said that in the previous governments, no attention was paid to boost exports. “If special attention was paid to Pak-Afghan trade and hurdles were removed, it would have benefited the entire industry of Khyber Pakhtunkhwa.”

He further said that the banks reluctance to provide Letters of Credit (LCs) for exports to Central Asian countries and the refusal of insurance companies to insure goods transport to Afghanistan is also affecting Pakistan export to Afghanistan.

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