Flow of US dollars into Afghanistan ‘weakens Pakistan’s foreign exchange reserves’

The chairman of Pakistan’s Forex Association says that over the past few months, about $2 billion dollars has entered Afghanistan through the country’s border, both legally and illegally.

Speaking at a press conference on Tuesday, Malik Bostan said that in the past, millions of dollars flowed into Pakistan from Afghanistan and was exchanged in the country, but this trend has not reversed.

“About two billion dollars have gone to Afghanistan from Pakistan in the form of official and unofficial trade, abuse of transit trade, smuggling and through the borders, and this has weakened Pakistan’s foreign exchange reserves and caused a heavy decrease in the value of the currency,” said Bostan.

According to him, Pakistan’s economy is suffering irreparable damage due to Afghanistan’s transit trade, which has grown significantly.

“In Afghanistan, due to economic sanctions, the bank account and system are frozen, so our trade with Afghanistan is not done through banking channels, but in cash,” he said.

“Only about 15,000 people go to Afghanistan every day and each of them brings $1,000 into this country, which is a total of $15 million dollars entering Afghanistan every day, and this has become uncontrollable,” he added.

According to him, at the beginning of the Islamic Emirate’s rule in Afghanistan, Pakistan’s foreign exchange reserves were $22 billion dollars and its import bill was $4.5 billion dollars.

This is while the border police of Herat province arrested two people who wanted to import $80,000 into Iran.