Transit trade deal favours Afghanistan

Allows Kabul access to India but does not facilitate Pakistan’s trade with Central Asia

ISLAMABAD:

The Afghan transit trade agreement leans more towards Afghanistan, allowing it access to Wagah border for exports to India while not facilitating Pakistan’s trade with Central Asian states.

Officials told The Express Tribune that a cabinet member had raised a question over allowing Afghanistan access to Wagah for exports to India.

The issue was taken up while considering extension in the Afghanistan-Pakistan Transit Trade Agreement (APTTA) 2010 for three months.

During discussion, the cabinet member inquired as to why Pakistan was allowing Afghanistan access to Wagah for exports to India while Afghanistan was not facilitating Pakistan’s trade with Central Asian countries.

Adviser to PM on Commerce Abdul Razak Dawood explained that it was already mentioned in the agreement and the Commerce Division had requested a three-month extension in the already signed agreement.

Meanwhile, a new agreement was under discussion and was nearing finalisation between the two countries.

He elaborated that by the end of March 2021, all relevant issues would be discussed with Afghanistan to boost Pakistan’s exports to Central Asia.

Speaking on the occasion, the minister for religious affairs and interfaith harmony said that local businesses around Torkham border had been severely hampered due to strict measures taken by border management forces.

Another member explained to the cabinet that the border was now open for trade six days a week, and in line with the directive of the prime minister, smuggling had been minimised. He pointed out that the border with Afghanistan and Iran was being fenced, but there was a lot of foot traffic each day, which put pressure on border management.

The prime minister appreciated the coordinated efforts of anti-smuggling agencies to stop smuggling, which ultimately boosted the local industry. He also emphasised the need for clamping down on smuggling of cigarettes, which was causing huge tax losses.

The Commerce Division briefed the cabinet that APTTA 2010 was a 10-year agreement, signed on October 28, 2010 in Kabul, which came into effect one month after exchange of instruments of ratification on February 12, 2011.

Over the last 10 years, 832,819 containers of Afghan transit trade, carrying goods worth $33 billion, passed through Pakistan, as per data compiled by the Federal Board of Revenue (FBR) Directorate General of Transit Trade.

It was estimated that 30% of Afghan transit trade cargo passed through Pakistan and the remaining through Iran, Uzbekistan and Tajikistan.

APTTA expired on February 11, 2021. It was informed that for the revision of APTTA, two meetings had been held - 7th APTTCA meeting in Kabul on November 16-17, 2020 and 8th APTTCA meeting in Islamabad on December 2830, 2020.

During the meetings, it was discussed by both sides that the text of APTTA 2010 would be revised and updated by incorporating proposed amendments, additions and suggestions and by deleting redundant articles, if any.

The text was discussed article by article and it was agreed to continue negotiations for finalising the new agreement.

Subsequently, the commerce minister of Afghanistan requested vide a letter dated January 20, 2021 that APTTA 2010 be enforced until the new agreement was finalised and signed. Legal opinion of the Ministry of Law and Justice was obtained on the modalities of extending APTTA 2010.

The commerce ministry was advised that if the two governments intended to extend tenure of the agreement, they may do so by signing an additional protocol to the agreement.

The cabinet was informed that recently on the sidelines of trilateral meetings on the trans-Afghan railway and first meeting of Pakistan-Uzbekistan Joint Working Group on Trade and Economic Affairs in Tashkent (Jan 31 to Feb 3, 2021), a meeting was held with an Afghan delegation, in which both sides agreed to extend APTTA 2010 by three months.

After the meeting, the commerce minister of Afghanistan requested vide a letter dated February 4, 2021 that APTTA be extended for three months, beyond February 11, 2021.

Accordingly, in light of the advice of the Ministry of Law and Justice, a draft protocol for the extension of three months was prepared and presented to the cabinet. The Commerce Division sought approval of the cabinet for the extension of APTTA 2010 for three months beyond February 11, 2021 through a mutually agreed additional protocol.

The cabinet considered the summary titled “Extension of Afghanistan Pakistan Transit Trade Agreement (APTTA 2010) for three months”, dated February 8, 2021 and submitted by the Commerce Division, and approved the proposal.