The annual trade volume between Pakistan and Afghanistan has dropped sharply from $2.5 billion to just $1 billion, as ongoing border closures and inconsistent trade policies continue to strain economic ties between the two neighbors.

Zia-ul-Haq Sarhadi, Vice President of the Pakistan-Afghanistan Joint Chamber of Commerce, described the decline as “deeply concerning,” warning that Pakistan’s broader regional trade ambitions, including access to Central Asian markets, depend on a stable trading relationship with Afghanistan.

For years, Pakistan has exported essential goods to Afghanistan, including cement, steel bars, pharmaceuticals, vegetables, flour, and sugar, while importing fresh produce and other agricultural products in return.

However, persistent challenges and growing diplomatic friction between the two countries have disrupted this exchange.

A key flashpoint occurred in February when heightened tensions prompted a closure of the Pakistan-Afghanistan border.
The shutdown halted the movement of goods and people, causing significant losses in tax revenues for both nations and stalling cross-border commerce.

“The impact wasn’t just on trade numbers,” Sarhadi noted. “From Karachi’s ports to the Torkham crossing, thousands of laborers and transport workers were left jobless for days. The ripple effects hurt the most vulnerable segments of society.”

Trade experts and business leaders are urging both Islamabad and Kabul to adopt consistent and transparent trade policies, emphasizing that long-term economic cooperation is vital not only for mutual economic benefit but also for fostering regional peace and stability.

They warn that without a sustained diplomatic and economic dialogue, both countries risk further isolation and economic stagnation, especially at a time when the region faces broader geopolitical and security challenges.

The Ministry of Public Works has announced the acceleration of multiple railway projects across Afghanistan, aimed at strengthening the country’s transportation infrastructure and building towards becoming a key transit corridor in Central and South Asia.

According to ministry spokesperson Mohammad Ashraf Haqshenas, survey work is currently underway for critical railway lines, including the Herat–Kandahar route and rail extensions in Balkh, Paktia, and Torghundi.

These efforts are part of a broader plan to interconnect Afghanistan’s major border crossings with a unified rail system that will significantly facilitate trade, mobility, and economic growth.

Afghanistan’s private sector has voiced strong support for the rail expansion initiative, emphasizing its potential to increase exports, boost national revenues, and attract foreign investment.

Business leaders believe the completion of these projects will mark a turning point in the country’s ability to participate in regional supply chains and improve internal logistics.

Construction is already underway on the third phase of the Khaf–Herat railway line in the west of the country. This key corridor, which links Afghanistan with neighboring Iran, is expected to facilitate both freight and passenger transport.

Iranian media have reported that a passenger rail service connecting Herat to Mashhad may become operational soon, a development that would mark a milestone in cross-border connectivity.

Simultaneously, preparations have begun for the launch of the Trans-Afghan railway corridor, a strategic project that aims to connect Uzbekistan to Pakistan via Afghanistan.

Once completed, this route will play a vital role in boosting regional trade, shortening cargo transit times, and offering landlocked Central Asian countries access to seaports.

These developments are part of Afghanistan’s broader effort to reposition itself as a regional trade and transit hub, linking Central Asia, South Asia, the Middle East, and beyond. The current government has prioritized infrastructure revival, focusing on key corridors such as the Lapis Lazuli Route, the Chabahar Corridor, and the Trans-Afghan Railway.

Despite ongoing economic challenges, Afghan officials remain committed to transforming the country into a bridge between continents, tapping into its geographic advantage and untapped transit potential. The expansion of the rail network is central to this vision, offering new hope for economic self-reliance and regional integration.

Imports of coal and soapstone from Afghanistan have come to a standstill at Torkham, Ghulam Khan, and Kharlaachi border crossings after Pakistani customs authorities made the certificate of origin mandatory for clearance.

The requirement, imposed this week, caught traders off guard, leaving hundreds of trucks stranded on the Afghan side and causing panic among importers and transporters ahead of Eid al-Adha.

Traders say the sudden halt—without prior notice—disrupted plans and delayed cargo meant for industrial use in Punjab and for export via Karachi.

Officials fear some goods may not genuinely originate from Afghanistan, prompting the documentation demand. Discussions with Afghan authorities on issuing the required certificates had previously stalled over technical issues like weight and value discrepancies.

Mujjebullah Shinwari, president of the Torkham Customs Clearing Agents Association, confirmed that efforts are underway to secure a temporary waiver for consignments already in transit.

“We’ve requested urgent relief from authorities in Islamabad and Kabul to ease pressure before Eid,” Shinwari said.

Traders remain hopeful for a resolution, warning that prolonged delays could disrupt supply chains and trade flow between the two countries.