Asia Times Online :: Afghan trucks roll to Wagah
KARACHI - Afghan trucks on Monday at last started to travel across Pakistan to the Wagah border crossing with India, under a United States-sponsored transit deal that came into effect on Sunday after eight months of wrangling over details.
Under the pact, which replaces the outdated Afghan Transit Trade Agreement of 1965, Afghan trucks can go directly to Wagah and Karachi and Gwadar ports with goods for export, while Pakistani trucks can cross into Central Asian states through the Heratan border.
Pakistan and Afghanistan finalized details for implementing the Afghanistan-Pakistan Transit Trade Agreement (APTTA) during a visit to Islamabad by Afghan President Hamid Karzai last week. The agreement was signed last October, but could not be
enforced after the two countries failed to sort out differences over bank guarantees for Afghan goods.
All issues related to implementation of APTTA have reportedly been resolved between the two countries. A biometric identification system at entry and exit points is to be installed within the next three to four weeks.
"Differences over bank guarantees in the new agreement have been removed," Press Trust of India reported an Afghan Embassy official as saying, while Reuters reported a senior Pakistan Commerce Ministry official as saying, "There is no hindrance to its implementation."
Pakistani Prime Minister Syed Yousuf Raza Gilani, addressing the press with Karzai last week, said bringing APTTA into operation was a landmark development.
In a 23-point declaration issued at the weekend in Islamabad, the two countries "agreed to continue to take all necessary steps to ensure that this agreement is fully implemented and that it contributes to the growth of trade, which has already witnessed a significant increase over recent years".
The two countries agreed to start consultations with other interested states to establish trade transit and facilitation mechanisms, which would enable their Central Asian neighbors to use land routes through Afghanistan and Pakistan to access the rest of the world.
Afghan transit trade has been the main source of smuggling into Pakistan, costing Islamabad millions of dollars in lost taxes annually while helping to undermine local Pakistani industries. Out of a total of US$5 billion of smuggled goods coming into Pakistan, 75% is due to the Afghan transit trade, according to Federal Board of Revenue.
Several Pakistani and Afghan traders import goods claiming they are headed to Afghanistan, but sell those goods in Pakistan without paying any duties. Substantial differences in the tariff structures of Pakistan and Afghanistan help to encourage such smuggling.
"The only real way to stop smuggling is to make it unprofitable," The Express Tribune reported Commerce Secretary Zafar Mehmood as saying. "Otherwise, it will keep going on, whether through trucks or on the backs of mules."
Pakistan has not yet formulated any long-term policy on haulage of commercial and non-commercial Afghan transit cargo, which involves considerable manpower and generates economic activity at ports, through loading, unloading and trucking stuff to the Pakistan-Afghan border.
Pakistan is also the main overland supply route for North Atlantic Treaty Organization forces in Afghanistan, although the United States increasingly looks to open alternative routes in Central Asia.
Afghanistan's imports via Pakistan at present amount to one-third of its total imports, while the remaining two-thirds come through Iran and Tajikistan.
Iran's role in Afghan trade increased with the completion in 2008 of the 218-kilometer Zaranj-Delaram road, built with the help of India. The link reduced Afghanistan's near total dependence on Pakistan for access to seaports by allowing a link with the Iranian port of Chabahar.
Delays in implementing APTTA further encouraged a shift in the Afghan transit trade with Iran, and Afghan traders increasingly book cargo containers from Dubai for transportation through the Iranian port of Bandar Abbas, east of Chabahar.
As many as 17,000 containers have been booked from Dubai to Bandar Abbas by Afghan traders, according to the Pakistan newspaper The News. This trend could continue due to delays in clearance and transport of imports to Afghanistan using Karachi port and crossing points to Afghanistan at Chaman, in Balochistan province, and Torkham east of Peshawar.
The new trade pact gives Pakistan access to Central Asian Republics, which is expected to increase the country's exports to that region by $1 billion a year.
KARACHI - Afghan trucks on Monday at last started to travel across Pakistan to the Wagah border crossing with India, under a United States-sponsored transit deal that came into effect on Sunday after eight months of wrangling over details.
Under the pact, which replaces the outdated Afghan Transit Trade Agreement of 1965, Afghan trucks can go directly to Wagah and Karachi and Gwadar ports with goods for export, while Pakistani trucks can cross into Central Asian states through the Heratan border.
Pakistan and Afghanistan finalized details for implementing the Afghanistan-Pakistan Transit Trade Agreement (APTTA) during a visit to Islamabad by Afghan President Hamid Karzai last week. The agreement was signed last October, but could not be
enforced after the two countries failed to sort out differences over bank guarantees for Afghan goods.
All issues related to implementation of APTTA have reportedly been resolved between the two countries. A biometric identification system at entry and exit points is to be installed within the next three to four weeks.
"Differences over bank guarantees in the new agreement have been removed," Press Trust of India reported an Afghan Embassy official as saying, while Reuters reported a senior Pakistan Commerce Ministry official as saying, "There is no hindrance to its implementation."
Pakistani Prime Minister Syed Yousuf Raza Gilani, addressing the press with Karzai last week, said bringing APTTA into operation was a landmark development.
In a 23-point declaration issued at the weekend in Islamabad, the two countries "agreed to continue to take all necessary steps to ensure that this agreement is fully implemented and that it contributes to the growth of trade, which has already witnessed a significant increase over recent years".
The two countries agreed to start consultations with other interested states to establish trade transit and facilitation mechanisms, which would enable their Central Asian neighbors to use land routes through Afghanistan and Pakistan to access the rest of the world.
Afghan transit trade has been the main source of smuggling into Pakistan, costing Islamabad millions of dollars in lost taxes annually while helping to undermine local Pakistani industries. Out of a total of US$5 billion of smuggled goods coming into Pakistan, 75% is due to the Afghan transit trade, according to Federal Board of Revenue.
Several Pakistani and Afghan traders import goods claiming they are headed to Afghanistan, but sell those goods in Pakistan without paying any duties. Substantial differences in the tariff structures of Pakistan and Afghanistan help to encourage such smuggling.
"The only real way to stop smuggling is to make it unprofitable," The Express Tribune reported Commerce Secretary Zafar Mehmood as saying. "Otherwise, it will keep going on, whether through trucks or on the backs of mules."
Pakistan has not yet formulated any long-term policy on haulage of commercial and non-commercial Afghan transit cargo, which involves considerable manpower and generates economic activity at ports, through loading, unloading and trucking stuff to the Pakistan-Afghan border.
Pakistan is also the main overland supply route for North Atlantic Treaty Organization forces in Afghanistan, although the United States increasingly looks to open alternative routes in Central Asia.
Afghanistan's imports via Pakistan at present amount to one-third of its total imports, while the remaining two-thirds come through Iran and Tajikistan.
Iran's role in Afghan trade increased with the completion in 2008 of the 218-kilometer Zaranj-Delaram road, built with the help of India. The link reduced Afghanistan's near total dependence on Pakistan for access to seaports by allowing a link with the Iranian port of Chabahar.
Delays in implementing APTTA further encouraged a shift in the Afghan transit trade with Iran, and Afghan traders increasingly book cargo containers from Dubai for transportation through the Iranian port of Bandar Abbas, east of Chabahar.
As many as 17,000 containers have been booked from Dubai to Bandar Abbas by Afghan traders, according to the Pakistan newspaper The News. This trend could continue due to delays in clearance and transport of imports to Afghanistan using Karachi port and crossing points to Afghanistan at Chaman, in Balochistan province, and Torkham east of Peshawar.
The new trade pact gives Pakistan access to Central Asian Republics, which is expected to increase the country's exports to that region by $1 billion a year.
