Trade between Pakistan and Afghanistan increased substantially, from $0.83 billion in 2006 to $2.1 billion in 2013. It was expected to reach $5 billion per annum this year but the emerging situation suggests that this might not be possible.
According to the Pakistan Afghanistan Joint Chamber of Commerce and Industry (PAJCCI), already there has been a decline by near 40 percent in imports from Pakistan compared to the same period last year.
Insecurity – for which an overwhelming majority of Afghans blame Pakistan’s Inter-Services Intelligence (ISI) – is being blamed for hindering economic growth. Following a string of deadly bomb blasts in the Afghan capital Kabul in mid-August, citizens launched a self-styled boycott of Pakistani goods.
Social media users posted videos and comments denouncing Pakistani goods and showing products being destroyed. This was followed by similar announcements from trade organizations, ruling out imports from Pakistan in the future.
Naqibullah Safi, spokesperson for the Afghanistan-Pakistan Joint Chamber of Commerce and Industries (APJCCI), confirmed that the boycott had made an impact on trade between the two countries.
He said a number of importers had turned to other regional countries following the August attacks.
According to analysts, Iran and Turkmenistan topped the list of alternative suppliers.
Mohib Sharif, an economist based in Kabul told Anadolu Agency that the international deal over Iran’s nuclear program had also paved the way for further growth between Tehran and Kabul.
He said bilateral trade between Iran and Afghanistan – currently worth just below $1 billion – was likely to rise following the decline in trade with Pakistan.
Earlier in August, Afghanistan and Turkmenistan signed three Memorandums of Understanding (MoU) and two agreements during the Turkmen President Gurbanguly Berdimuhamedow’s visit to Kabul.
To consolidate ties with this energy-rich Central Asian country, Afghanistan’s finance minister, Eklil Hakimi, travelled to the Turkmenistan capital Ashgabat.
'The trip was full of achievements; headway has been made on the transfer of electricity, gas pipelines, fiber optic and trade ties,' Hakimi told journalists on Saturday.
Khan Jan Alakozay, vice president of the Afghanistan Chamber of Commerce and Industries (ACCI), supported the move to boycott Pakistani products but warned against it being merely emotional.
'People have the right to express their sentiments through peaceful means but there should be an alternative in place to ensure price stability and the availability of necessary items,' he told Anadolu Agency.
According to Alakozay's ACCI figures, Afghanistan meets at least 80 per cent of its import needs from Pakistan in trade worth more than $3 billion a year. Food items, construction material, medicines and chemicals top the list.
However, Mohib Sharif argued that a total boycott of such products was unrealistic, at least for the sake of eastern provinces bordering Pakistan.
'In the east, it is much too easy and affordable to import, for instance, food items and other commodities from Pakistan at reasonable rates rather than Iran and the Central Asian states,' he said.
In the late 1980s, the communist-led government under Mohammad Najibullah Ahmadzai officially boycotted Pakistani products; Kabul was strongly supported by the former Soviet Union for its basic needs.
Sharif claims that the market situation has changed drastically since then.
'The free-market economy has changed a lot; the government cannot interfere that way it did in the old days. It is the traders who now choose source and supply markets based on their interests,' he says.
By Shadi Khan Saif
Anadolu Agency
enerji@aa.com.tr