Indian dry fruit traders upset over partial resumption of Afghan banking system

Local dry fruit traders are concerned about the partial resumption of the banking system of Afghanistan since the Islamic Emirate of Afghanistan’s (IEA) takeover in August last year.

Dry fruit traders said this week that only two weeks ago did Ghazanfar Bank in Kabul start accepting foreign transfers. Since August last year, traders have been forced to pay for goods by sending money via Gulf States, they said.

One Indian trader, BK Bajaj, said his counterparts in Afghanistan asked him to send some payments through Ghazanfar Bank but that the majority of payments continue to be routed through Gulf countries.

India imports around $500 million worth of dry fruit from Afghanistan every year.

Afghanistan’s banking system came to a virtual standstill in the wake of the fall of the previous government, and has only slowly resumed some services in recent months.

Indian traders said initially, Afghan dry fruit suppliers provided goods on credit until they were able to have money transferred to Gulf countries.

Afghanistan’s banking system took a beating following the take over by the IEA, when the international community immediately applied sanctions on the country. Countries like the US and EU and institutions like the IMF and World Bank stopped any financial engagement in the country, which severely limited the amount of foreign dollars entering the country.

Most notably, the Federal Reserve Bank of New York froze some $9 billion of the country’s total $10.5 billion in assets of the country’s federal reserve. This has had a severe impact on the country and cut foreign trade considerably.