Businessmen oppose transit trade facility to India

[Naveed Yaseen]

By Qaiser Khan Afridi
PESHAWAR: The business community of the Frontier Province has voiced objection to the signing of a trilateral memorandum of understanding (MoU), which they fear would ultimately allow India to use the Wagah-Khyber route for trade with Kabul.

While some of the businessmen dealing in the Pak-Afghan Transit Trade are of the view that trade between India and Kabul via Pakistan was already underway saying if the expected agreement was signed in December and India was allowed access into Afghanistan, then Pakistani transportation sector would be affected as India would use its own transport.

Sarhad Chamber of Commerce and Industry (SCCI) President, Sharafat Ali Mubarak and Vice President Mohammad Ishaq told The News that the government had not taken the business community into confidence before signing the MoU.

“We want enhancement of the bilateral trade between Pakistan and Afghanistan but have reservations over the proposed World Bank’s Transit Trade Agreement about which we have informed the federal government,” they said.

They said trade between Pakistan and Afghanistan should on equality basis, like the Afghan government should provide the same facilities, which were being provided by the Pakistani government. “Pakistani goods should be given access into the markets of the central Asian states,” they said adding Afghan government had imposed 18 per cent import duty on the Pakistani goods whereas there was no import duty on the Indian items.

“If the government allows India access to Afghanistan then other countries like Iran, Iraq, Central Asian States and Pakistan should also be allowed trade with other countries while using the Indian route,” they said. They further said that due to discriminatory policies on part of the Afghan government, trade between Pakistan and Afghanistan had plummeted to $400 million from $2 billion in the last three years.

Replying to a question about the duty-free goods smuggled back to Pakistan from Afghanistan, which were being exported to Afghanistan under Afghan Transit Trade, they said the government should either reduce import duty on those items, whose demand is high in Pakistan or give incentives to the local industry for quality production in order to compete with the smuggled goods.

Peshawar Industrialist Association President, Nauman Wazir expressed reservations over the signing of the trilateral MoU in Washington, allowing India to use the transit Wagha-Khyber route for trade with Afghanistan.

Taking strong exception to the signing of the MoU, he said it was likely to turn into a full-fledged trade agreement by end of the year. He said goods brought to Afghanistan under the Afghan Transit Trade Agreement have wreaked havoc with the local industries adding the availability of all kinds of goods, even viable industrial units in the province failed to compete with the duty-free goods smuggled back to Pakistan from Afghanistan.

He was of the view that earlier China, Korea and Japan used to export their goods to Afghanistan. However, due to long distance they pay high transportation charges. Allowing India to use Wagha-Khyber transit route would render the remaining industrial units closed. He said the export of Indian goods through Wagha would cost India less and these goods would be smuggled back to Pakistan.

Wazir called for fencing of the border between Afghanistan and Pakistan to prevent the smuggling of goods imported under the agreement. He said they pay all taxes on the goods manufactured in the country while the smuggled goods are up for sale in the country openly.

“The government and the international community should either guarantee that the goods would not enter Pakistan or recommend tax on them,” Wazir said. He feared that allowing India to use Pakistani land would not only cast negative impact on the industries of NWFP, but also the units in Punjab.

All Pakistan Commercial Exporters Association (APCEA) Chairman, Zia-ul-Haq Sarhadi said trade between Afghanistan and India through Pakistani routes was already going on. “Its not a new thing as business activities were going on since 1965, when the Transit Trade Agreement was signed between Pakistan and Afghanistan,” he said adding, fruit and dry fruit were being exported to India from Afghanistan through Wagha border while some other items were being exported to India through Karachi sea route to Mumbai.

http://www.thenews.com.pk/daily_detail.asp?id=176817