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Millions in US dollars smuggled into Afghanistan from Pakistan daily

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Millions of dollars are being smuggled into Afghanistan from Pakistan every day, providing some support for the fragile economy.

Muhammad Zafar Paracha, general secretary of the Exchange Companies Association of Pakistan, told Bloomberg that traders and smugglers bring as much as $5 million across the border daily, which more than covers the as much as $17 million that Afghanistan’s central bank injects into the market each week.

The illicit cash flows show how the Islamic Emirate of Afghanistan (IEA) is evading sanctions after their 2021 takeover of the country, Bloomberg reported.

For Pakistan, however, it’s contributing to the depletion of foreign reserves and adding to the downward pressure on the rupee as the currency tumbles to record lows and the economy teeters on the edge of collapse.

“Currency is being smuggled without any doubt,” Paracha told Bloomberg. “This has become quite a lucrative business.”

“Afghanistan has about a $10 to $15 million requirement on a daily basis,” said Khurram Schehzad, chief executive officer at Alpha Beta Core Solutions Pvt Ltd., a financial consultancy in Karachi. Half of this is estimated to come from Pakistan, he said.

Da Afghanistan Bank, the country’s central bank, has enough dollars in reserve to support the economy, the bank’s spokesman Haseeb Noori told Bloomberg.

However, some of it comes from the UN, which has been providing about $40 million in humanitarian aid each week since late 2021.

This cash is transported by air to Kabul each week and much of it then needs to be converted into afghani after it arrives. So even though the aid doesn’t directly benefit the IEA, the dollars ultimately end up in the central bank’s coffers, Bloomberg reported, adding that the UN wasn’t immediately available to comment.

According to the report, the afghani has gained about 5.6% against the US dollar over the past year through Monday, one of the strongest performances of any currency in the world.

This while Pakistan’s rupee has lost about 37% against the US currency over the same period, one of the largest declines. It fell about 10% in one day in late January, the biggest drop in at least two decades, as the crisis-stricken government relaxed its grip over the exchange rate in a bid to win much-needed loans from the IMF, Bloomberg reported.

However, according to Bloomberg, the smuggling of US dollars into Afghanistan really took off in the middle of last year after Afghanistan increased coal exports to Pakistan.

In addition, it has been boosted by the IEA’s ban on the use of Pakistan’s rupee as legal tender in Afghanistan, which forces exporters to trade in dollars and bring the US currency back to the country, the officials told Bloomberg.

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Pakistan’s mistakes played significant role in rise of terrorism: Maulana Fazl-ur-Rehman

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Maulana Fazl-ur-Rehman, chief of Pakistan’s Jamiat Ulema-e-Islam-Fazl (JUI-F) political party, has said that Pakistan’s mistakes played a significant role in the rise of terrorism.

In an interview with Samaa TV, the politician noted that Pakistan provided refuge to 30 to 40 million people during the Afghan war against the Soviet Union.

Rehman expressed his concern about the possibility of a war with Afghanistan, saying: “Whether there is a threat of war with Afghanistan or not requires further thought. War would not be beneficial for either Afghanistan or Pakistan.

“We need a comprehensive strategy for peace in Afghanistan, and the rulers must think about these matters and involve all political parties,” he said.

Pakistani officials have repeatedly claimed that militants attacking Pakistan have sanctuaries in Afghanistan, a charge the Islamic Emirate denies.

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Deputy PM inaugurates launch of Arghandi Transport Terminal Project in Kabul Province

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Mullah Abdul Ghani Baradar Akhund, Deputy Prime Minister for Economic Affairs, on Sunday inaugurated the start of construction work on the Arghandi Transport Terminal in Paghman District of Kabul Province.

The inauguration ceremony was attended by the Acting Minister of Transport and Aviation, Mullah Hamidullah Akhundzada, representatives from the private sector, and a number of local residents.

Baradar said the initiative was a vital step in the development of transport infrastructure in the country.

He stated that the development and expansion of transport infrastructure is an essential step toward economic growth, national development, and domestic and regional connectivity.

According to him, decades of war and corruption resulted in the sector having been neglected.

He said existing infrastructure has deteriorated due to poor quality construction; public lands have been usurped by individuals; and that highways and roads have been significantly narrowed.

Baradar also pointed out the need for investment in the transport sector; for the recovery of usurped state land; and the identification and restoration of original roads. He said these factors were among the core national objectives of the Islamic Emirate of Afghanistan.

In line with these goals, construction work on the Arghandi Transport Terminal got underway on Sunday.

Baradar said the Islamic Emirate is not only firmly committed to the development and expansion of transport infrastructure but is also actively pursuing other fundamental strategic objectives.

The Arghandi Transport Terminal in Kabul Province will be constructed on approximately 900 jeribs of land and will cost about 1.285 billion afghanis.

The project is expected to be completed by the private sector within two years.

Upon completion, the terminal will enhance transportation facilities, play a key role in improving the efficiency and organization of logistics and transit operations, reduce transportation costs and traffic congestion, and provide employment opportunities to a large number of citizens.

 

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Bayat Foundation distributes food aid to dozens of needy families in Balkh

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Bayat Foundation distributed food packages to dozens of needy families in Afghanistan’s northern Balkh province this weekend.

The packages included flour, rice, and cooking oil.

Officials of Bayat Foundation in Balkh said that aid distribution will continue in other provinces of the country until the end of the holy month of Ramadan.

“In continuation of Bayat Foundation’s assistance, this time we have distributed our Ramadan aid in Mazar-e-Sharif, which includes flour, rice, and cooking oil, and God willing, this assistance will continue,” Yafes Saqib, Bayat Foundation representative in Balkh, said.

Meanwhile, beneficiaries welcomed the distribution of the aid packages, saying that Bayat Foundation has played an important role in reaching out to the poor, the needy, and in reducing poverty.

“We are very happy. It is the month of Ramadan. May God help anyone who helps us poor people,” Aynuddin, an aid recipient, said.

“I don’t have a breadwinner in my family. On Thursdays, I go and collect Pepsi cans to find bread for my children,” Zarmina, another aid recipient, said.

The assistance comes at a time when international organizations have warned of increasing poverty in the country.

 

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