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Trade Chamber welcomes preferential pact with Kabul but flags persistent barriers

The chamber also criticized delays in visa issuance for Afghan businessmen, calling for a streamlined process to facilitate greater economic engagement.

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The Pakistan-Afghanistan Joint Chamber of Commerce and Industry (PAJCCI) has welcomed the signing of a preferential trade agreement (PTA) between Islamabad and Kabul but expressed concern over ongoing obstacles hampering bilateral and transit trade.

The agreement, formalized earlier this week by Pakistan’s Commerce Secretary Jawad Paul and Afghanistan’s Deputy Minister of Industry and Commerce Mullah Ahmadullah Zahid, reduces tariffs on key agricultural exports.

Under the new terms, duties on Afghan grapes, pomegranates, apples, and tomatoes — as well as Pakistani mangoes, oranges, bananas, and potatoes — have been slashed from over 60% to 27%, with a further reduced 22% rate for tomatoes and potatoes.

“This progress builds on discussions held during the Special Investment Facilitation Council (SIFC) meeting on December 17, 2024,” PAJCCI Chairman Muhammad Zubair Motiwala said in a statement Saturday.

“This milestone reflects our longstanding demands, pursued through consistent efforts and reinforced during the SIFC meeting, marking a significant step towards enhancing trade,” he said.

However, despite the agreement, PAJCCI President Junaid Makda warned that structural and regulatory hurdles continue to undermine trade potential. He noted that bilateral and transit trade volumes have plummeted from a peak of $2.5 billion to just $1.2 billion in 2024, The Express Tribune reported.

“As outlined in our recent letter to Interior Minister Mohsin Naqvi, these issues include the lack of a consistent, long-term trade policy from the Ministry of Commerce and the State Bank of Pakistan, creating uncertainty among traders and discouraging investment,” Makda said.

He added that payment disputes — fueled by banking limitations — have triggered unwarranted scrutiny by the Federal Investigation Agency (FIA), further eroding traders’ confidence. The temporary nature of Electronic Import Form (EIF) waivers also complicates planning and logistics for businesses engaged in cross-border commerce.

The chamber also criticized delays in visa issuance for Afghan businessmen, calling for a streamlined process to facilitate greater economic engagement.

In addition, the chamber raised concerns over the 1% infrastructure development levy imposed by the Khyber Pakhtunkhwa government. While the rate has been reduced, PAJCCI argues it still burdens transit trade and contravenes Pakistan’s international trade commitments.

The chamber warned that such fees are driving some trade to alternative routes such as Iran’s Chahbahar port, undermining Pakistan’s regional competitiveness, Dawn News reported.

PAJCCI urged the federal government to implement systemic reforms to eliminate policy inconsistencies and operational inefficiencies that continue to stifle trade growth between the two neighboring countries.

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Tajik investors express interest in cement production in Afghanistan

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A delegation of Tajikistani investors has expressed interest in establishing a cement production factory in Afghanistan, signaling renewed economic engagement between the two neighbors after four years of limited activity.

The delegation met with Hedayatullah Badri, Afghanistan’s Minister of Mines and Petroleum, to discuss potential investment opportunities in the country’s mining and industrial sectors. Officials said the visit reflects Tajikistan’s increasing willingness to expand economic cooperation with Afghanistan.

During the meeting, the Tajik investors praised the Islamic Emirate for what they described as improved security and a more conducive investment environment across Afghanistan.

Minister Badri welcomed the investors’ proposal and assured them of the government’s full support, emphasizing that Afghanistan is ready to facilitate investment through streamlined procedures and favorable conditions.

Representatives of Afghanistan’s private sector also view the development as a positive step toward strengthening bilateral economic ties.

Abdul Jabbar Safi, head of the Afghanistan Industries Association, said:
“After four years, Tajikistan is looking to take part in Afghanistan’s economic sector. This is encouraging news for the governments and the people of both countries.”

Economic experts believe that deeper economic engagement between Afghanistan and Tajikistan could unlock significant mutual benefits.

Nazir Ahmad Khalil, an economic analyst, said: “Tajikistan and Afghanistan share language, culture and geography. Expanding trade and investment between the two countries can meaningfully improve their economic situations. Building trust will be essential for long-term cooperation, and such investment can play a major role in poverty reduction and confidence-building.”

This new chapter of economic cooperation between Afghanistan and Tajikistan comes at a time when, since the return of the Islamic Emirate to power, several major projects have been launched between Afghanistan and Central Asian states.

The leadership of the Islamic Emirate has repeatedly emphasized that it seeks to strengthen economic relations with neighboring countries, the region, and the wider world on the basis of mutual respect.

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Trade bodies warn almost 11,000 Afghan transit containers stuck at Karachi port

SCCI officials urged authorities to separate trade from political tensions and immediately launch dialogue to restore commercial traffic between the two countries.

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Trade bodies report that nearly 11,000 Afghan transit trade containers are stranded at Karachi port, while thousands more— including shipments of perishable goods—remain stuck at the Ghulam Khan, Spin Boldak, Kharlachi, and Torkham crossings between Afghanistan and Pakistan.

Traders involved in Pakistan–Afghanistan bilateral and transit commerce say they have suffered billions of Pakistani rupees in losses as the prolonged border shutdown continues to stall the movement of goods. Perishable food items have already begun to spoil, compounding financial losses.

They also report a sharp drop in bilateral trade volumes. Exporters who were already issued Form-E certificates have been unable to dispatch consignments, with the closure now nearing two months.

Sarhad Chamber of Commerce and Industry (SCCI) President Junaid Altaf said trade—already limited—has deteriorated further due to the closure of crossings. He estimated losses of roughly $45 million since the Torkham closure began, adding that the halt is damaging for both economies and directly affecting families whose livelihoods depend on trade.

SCCI officials urged authorities to separate trade from political tensions and immediately launch dialogue to restore commercial traffic between the two countries.

In recent weeks, repeated closures of the Pakistan–Afghanistan crossing have also brought pharmaceutical exports to a halt, putting nearly $200 million worth of medicines at risk. Hundreds of trucks carrying antibiotics, insulin, vaccines, and cardiovascular drugs remain stuck at Torkham and Chaman, with temperature-sensitive supplies facing potential spoilage.

The Pakistan Pharmaceutical Manufacturers Association (PPMA) warned that the disruption extends far beyond Afghanistan’s medicine supply. Afghanistan is Pakistan’s main overland route to Uzbekistan, Tajikistan, Turkmenistan, and Kazakhstan, and ongoing shutdowns are undermining key regional connectivity projects, including the Pakistan–Uzbekistan–Afghanistan railway.

Stakeholders are calling for urgent steps to reopen the crossings, warning that prolonged closures threaten not only pharmaceutical exports but Pakistan’s broader economic engagement across the region.

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Pakistan’s citrus export crisis deepens amid ongoing Afghanistan trade route closure

Afghanistan, which absorbs around 60% of Pakistan’s citrus exports, has remained closed to trade since mid-October.

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Pakistan’s citrus sector is facing a worsening export crisis as the closure of the Afghanistan crossing continues to block access to its largest market.

Despite the start of the 2025 citrus season, exports are set to fall further from an already steep decline — dropping from $211 million in fiscal year 2021 to just $92.5 million in fiscal year 2025.

Afghanistan, which absorbs around 60% of Pakistan’s citrus exports, has remained closed to trade since mid-October.

This year alone, Pakistan shipped 153,683 tonnes of citrus to Afghanistan, while exports through the Afghan transit route also supply Russia, Kazakhstan, and Uzbekistan. With that corridor shut, exporters warn that the bulk of Pakistan’s kinnow harvest could go unsold.

A temporary policy exemption now allows citrus shipments to transit through Iran, but exporters say volumes to Central Asia and Russia cannot compensate for the loss of the Afghan market.

The crisis, however, goes deeper than the current crossing closure situation. Pakistan’s citrus industry continues to suffer from long-standing structural challenges — including reliance on the outdated, seeded kinnow variety that makes up over 90% of exports.

Climate change, rising pest pressure, shrinking yields, and declining A-grade fruit quality have all eroded competitiveness. Yields have fallen to about six tonnes per acre, and nearly half of kinnow processing units have closed.

Global competitors such as Egypt, China, Spain, Morocco, and Brazil have overtaken Pakistan by introducing new seedless, high-yielding varieties with longer harvest windows. As profits shrink, farmers are abandoning citrus orchards: the cultivated area has dropped 16% in the past five years.

Experts say Pakistan must urgently invest in developing seedless, climate-resilient varieties and strengthen existing research centres. At the same time, trade officials need to diversify export destinations by securing new sanitary and phytosanitary agreements to reduce dependence on a single market.

Without structural reforms and diversified access, Pakistan’s signature fruit risks losing its place in global markets — and its farmers risk losing their livelihoods.

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