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Pakistan passes order to allow barter trade with Afghanistan, Iran, Russia

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Pakistan has passed a special order to allow barter trade with Afghanistan, Iran and Russia for certain goods, including petroleum and gas, the Ministry of Commerce said on Friday.

Left with barely enough foreign exchange reserves to cover one month’s imports, Pakistan’s government is desperately trying to manage a balance of payments crisis and bring inflation under control after it hit a record of nearly 38% last month, Reuters reported.

The government order, called the Business-to-business (B2B) Barter Trade Mechanism 2023 and dated June 1, lists goods that can be bartered. State and privately owned entities would need approval to participate in the trade mechanism.

After Pakistan’s first purchase of discounted Russian oil in April, petroleum minister Musadik Malik told Reuters that Pakistan would only be buying crude, not refined products under the deal.

There was no confirmation about how the payment would be made. But, Malik said purchases could rise to 100,000 barrels per day (bpd) if the first transaction went smoothly.

Last year, Pakistan imported 154,000 bpd of crude oil, little changed from 2021, data from analytics firm Kpler showed.

In May, Pakistan Petroleum Dealers Association complained that up to 35% of the diesel sold in Pakistan had been smuggled from Iran.

Pakistan’s government has also ordered a clamp down on smuggling of flour, wheat, sugar, and fertilizer to Afghanistan.

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Afghanistan transit trade through Pakistan hits historic low

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Torkham

Afghanistan’s transit trade through Pakistan has dropped to its lowest level in years, according to Pakistan’s Dawn newspaper.

The report says transit cargo declined from nearly 89,000 containers worth $5 billion before the Islamic Emirate returned to power to just 11,592 containers valued at $367 million in the last fiscal year.

According to Dawn, while Pakistan’s closure of Durand Line crossings with Afghanistan in October 2025 over security concerns accelerated the decline, the downward trend had already begun earlier.

Trade analysts told the newspaper that Afghanistan had already been working to reduce its reliance on Pakistani ports by expanding trade through Iran and strengthening commercial links with Central Asian countries.

The report says transit cargo through Pakistan initially rose after the Islamic Emirate’s return to power, peaking at more than 102,000 containers in fiscal year 2023, before steadily declining in subsequent years.

Dawn also reported that reverse transit, which allowed Afghan exports to reach third countries—particularly India—through Pakistan, has nearly come to a halt, falling from $454 million in fiscal year 2025 to just $7 million in fiscal year 2026.

Citing the World Bank, the newspaper said Iran has become Afghanistan’s largest source of imports, with Iranian direct and transit routes now accounting for nearly half of the country’s total imports.

However, the World Bank says the shift to alternative routes has increased import costs, reduced export revenues, and added inflationary pressure, while the decline in cross-Durand Line trade has also affected thousands of jobs linked to transport, customs, warehousing, and other businesses.

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Afghanistan, India discuss ways to boost trade and investment ties

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Sayed Karim Hashemi, chairman of the Afghanistan Chamber of Commerce and Investment (ACCI), has met with Indian ambassador in Kabul, Yatin Patel, to discuss ways to strengthen bilateral trade and investment cooperation.

According to ACCI, the meeting focused on expanding exports, improving trade facilitation, easing business visa procedures, enhancing logistics, and increasing cooperation in key sectors including agriculture, mining, and handicrafts.

The two sides also agreed to promote joint exhibitions, organize business delegations, and develop long-term partnerships between the private sectors of Afghanistan and India.

The meeting comes as Afghan and Indian officials and business leaders continue efforts to expand economic relations and create new opportunities for trade and investment between the two countries.

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Afghanistan temporarily eases fuel import standards to help curb rising prices

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Afghanistan’s state-owned Oil and Gas Company has announced a temporary adjustment to some technical standards for importing gasoline, diesel and liquefied petroleum gas (LPG) following a sharp rise in global oil and gas prices and their impact on the domestic market.

In a statement, the company said the committee responsible for preventing the import of substandard fuel had reviewed market conditions and domestic demand before deciding to temporarily apply revised limits to certain technical specifications and permissible standards for imported fuel under specific conditions.

The company said the move is an exceptional and temporary measure aimed at facilitating fuel imports, ensuring timely market supply, preventing shortages and reducing the impact of global price volatility. The revised standards will remain in effect until market conditions stabilize and relevant authorities issue further instructions.

The decision comes as fuel prices have risen sharply across Afghanistan in recent days, prompting widespread public concern and complaints.

The increase has been linked to a significant decline in Afghanistan’s fuel imports from Russia following recent Ukrainian attacks on Russian oil facilities, which have disrupted supplies.

 
 
 
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