Wahgah border for Indo-Afghan trade: Pakistan's stance softens under US pressure

[Lahore_Real_Estate]

ISLAMABAD (May 08 2010): Pakistan has reportedly softened its stance on opening of Wahgah border for trade of goods from India under Washington-pushed Afghanistan-Pakistan transit trade agreement (APTTA) but has not gives any final timeframe, sources told Business Recorder.

This indication came at a meeting between Commerce Minister Amin Fahim and Afghan Minister for Commerce and Industry Ghulam Muhammad Ailaqi held for two and a half hours in the committee room of Commerce Ministry here on Friday. Last year, Pakistan had promised the United States (US) that the revised APTTA would be finalised by November 2009, but insiders said that unresolved technical issues continued to be impediments in Islamabad's approval.

Since the signing of a Memorandum of Understanding (MoU) between Pakistan and Afghanistan in Washington under the guidance of Secretary of State Hillary Clinton, the United States has been continuously pressing Pakistan to open the Wagah border to facilitate trade between India and Afghanistan. The Afghan delegation, which was due at 11.30 am, reached the Ministry 15 minutes before the scheduled meeting.

"We are doing our homework on opening of Wagah border, and as and when it is completed, we will move forward," said one official attending the meeting. Another official quoted Commerce Secretary Zafar Mahmood as saying that first the Joint Working Group (JWG) of the two countries would finalise recommendations on the revised APTTA and then the government would move forward.

He was also of the view that APTTA should be drafted in a way that the governments and the people (stakeholders) of both countries would accept it. This implies that Pakistan is not in a hurry to finalise the agreement. The new APTTA is being negotiated by a Joint Working Group (JWG), comprising representatives of relevant ministries ie Commerce, Communication, Foreign Affairs, Interior, Ports and Shipping, Railways, Industries and the Federal Board of Revenue (FBR).

Sources said that third meeting of JWG was held on August 4-5, 2009 in Islamabad where the issue of unauthorised trade (smuggling) was discussed in detail. Both countries agreed to conduct a joint study on unauthorised trade between Afghanistan and Pakistan by USAID consultants. The Terms of References (TORs) drafted by the GoP were sent to Afghanistan for comments which have been vetted by the Afghan government.

The sixth round of negotiations is likely to be held on May 17-20, 2010 in Kabul to give final touches to the draft of the APTTA. USAID is also closely monitoring progress on the pact between Pakistan and Afghanistan which is being revised after 40 years of its commencement.

Sources said that the Afghan delegation lodged complaints against Pakistan's customs officials, alleging misbehaviour with Afghan traders and businessmen during loading and offloading of goods to and from Afghanistan. The Afghan delegation also said that Pakistan should ease rules for seasonal and perishable Afghan goods so that the traders do not bear financial loss.

Both countries discussed the ways and means to formulate a mechanism to insure goods transported under ATTA as Afghan side complained that there was no system to compensate those traders whose goods are damaged while moving from one destination to other.

Sources said that Pakistan raised serious concerns over the massive misuse of ATTA, as nearly 50 percent of imported goods come back (smuggled) to Pakistan, hurting not only the local industry but also negatively impacting revenue. "Address these issues seriously, otherwise new APTTA will not have any positive impact on the trade of both countries," sources quoted Pakistan officials as saying in the meeting.

Pakistan also suggested that both countries should conduct a joint study to assess the impact of smuggling on their economies. An official announcement attributed the following statement to Commerce Minister Fahim" "APTTA, which is under negotiations, should be acceptable to the Government of Pakistan (GoP) and Afghanistan and people of both countries; both sides resolved to address each other's concerns in a positive manner besides facilitating transit trade."

Amin Fahim assured the Afghan delegation that all important issues would be addressed in a mutually beneficial manner while framing the new APTTA.

Both sides also discussed the impediments in bilateral trade. Pakistan assured that no discrimination whatsoever would be meted out regarding transportation of goods from seaports to the Afghan borders. Both sides agreed to the point that it would be in the interest of both countries to move forward and promote trade relations, the announcement said.