Afghan and Pakistani traders have welcomed Pakistan’s decision to keep borders operational for six days a week, but Afghan traders say that their transit cargo is lying at Karachi ports under severe demurrage and detention charges since the first week of March 2020.
They argue that both Afghan transit trade and bilateral trade between Pakistan and Afghanistan suffer losses of billions of rupees.
Ahmad Shah Yarzada, member of the Pakistan-Afghanistan Joint Chamber of Commerce and Industry, who imports goods under transit trade, says they encounter delays up to 5-12 days for cargo clearance at Karachi, whereas the domestic cargo is cleared within 1-4 days based on the available evidence.
“This causes considerable losses for Afghan traders because shipping company generally provides only 21 days free detention including clearance time, but it takes at least 25-30 days to complete the cycle of returning the empty container back to the shipping company owing partly to transit and customs delays,” Yarzada told Daily Times on Sunday.
Pakistan and landlocked Afghanistan had signed a transit trade agreement in 1965 that was revised in 2010. Afghans traders have been using ports in Karachi since then and Pakistan has now allowed Afghan traders to import goods via the Gwadar port in Balochistan province.
Pakistan last month announced to allow import of the Afghan bulk cargo of wheat, sugar and fertilizers at the Gwadar port and onward transit to Afghanistan in sealable trucks, instead of being limited to containers.
Abdul Razak Dawood, advisor to Pakistani prime minister on commerce, textile, industry and production, and investment says that a cargo ship, carrying 16,000 tons urea for transit to Afghanistan arrived at the Gwadar port on Friday. The China Overseas Port Holding Company, which operates the Gwadar port, also confirmed arrival of the Afghan cargo ship.
Asim Saleem Bajwa, Chairman CPEC Authority and Special Assistant to the Prime Minister on Information and Broadcasting tweeted at the weekend that a dream come true for local economy with the arrival of the first bulk-cargo ship “MV Manet” carrying wheat n urea of Afghan Transit trade. He said it will stimulate host of business activity.
Afghan Ambassador to Pakistan Atif Mashal has welcomed Pakistan’s decision and hoped it will boost bilateral trade and transit ties between the two countries.
Yarzada; however, insists that Afghan traders will get benefit of the 6 days and round-the-clock opening of the border if their cargo at Karachi ports is cleared.
“This causes considerable losses for Afghan traders because shipping company generally provides only 21 days free detention including clearance time, but it takes at least 25-30 days to complete the cycle of returning the empty container back to the shipping company owing partly to transit and customs delays,” he said.
“Since the process of returning trucks exceeds the detention period, the traders are liable to pay 100-120 US dollars per day for 40’ft container as the detention charges to the shipping company,” Yarzada said.
Yarzada said an Afghan Pakistan Transit Trade Agreement only up to 5 percent examination of consignment is allowed based on risk management basis, but unfortunately 80% is done without taking into consideration nature of the cargo, which he termed as violation of the APTTA.
Giving further explanation, he said problems caused due to scan of Afghan Transit cargo at Karachi, adding if the physical examination is done then scan must be avoided otherwise if the cargo is scanned then the physical examination shall be avoided.
“There is no justifiable reason to make both physical examination of the cargo and scan,” he said, adding there is only one scanner machine installed at each of ports in Karachi while hundreds of Afghan transit consignments arrived to Karachi on daily basis from different countries.
“Since the capacity of Scanner Machine is not enough to scan such huge numbers of containers/consignment, therefore Afghan transit cargo is delayed for 5-10 days at Karachi ports exposed to heavy detention and demurrage charges,” he said.
When asked about Pakistan’s longstanding complaint about the smuggling of transit goods to Pakistan, he said if not 100 percent but 99 percent all transit cargo duly cross Torkham and Chaman border to Afghanistan. Later all the transit goods duly reach to Jalalabad customs house and Kandahar customs house and after the customs duty/sales tax paid then goods are moved forward to other cities across the country.
When asked as how these goods enter into Pakistan, he said as usual these goods are transported from Garo Ko area in Afghanistan by camels and horses to Tabai and Bazar area in Pakistani.
“Since it is a mountainous region the only source of transport is considered horses & camels. These goods will be stored inside the warehouses in Tabai / bazar and later moved by full trucks to Karkhano markets Jamrod road Peshawar,” Yarzada said.
“These goods are smuggled into Pakistan right in front of nose of the relevant Pakistani authorities at the specific routes in day light. The reason is the relevant authorities are paid cash amount Pak Rs 20-30 million against each truck allowed,” he claimed.
“Once the money is paid then there is no one to dare stop the truck from Bazar right up to Karkhano markets, near Peshawar. The genuine smuggling is done in day light and nobody can stop it or call it smuggling, but unfortunately Afghan transit is stopped / halted under various pretends despite of the APTTA.
When asked about Pakistan’s complaint that Kabul is not convening the long pending meeting of the Afghanistan-Pakistan Transit Trade Coordination Authority (APTTCA), which oversees implementation of the transit agreement, he said Afghan side argues Pakistan has not implemented decisions in the previous APTTCA meetings and another meeting will be useless.
The last meeting of the authority was held in Islamabad in 2016 and Kabul was to host its meeting in 2017.