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All kinds of goods worth millions of US dollars imported under ATT are lying at Karachi Port

Dec 10 - 16 , 2001

The government may allow Afghan traders to sell their goods imported under Afghanistan Transit Trade (ATT) in local markets after paying duties at the rates currently applicable to Pakistani importers.

All kinds of goods worth millions of US dollars imported under ATT are lying at Karachi Port, Quetta & Peshawar which could not be transported onward because of US attack on Afghanistan specially after the fall of Kabul. Afghan importers have requested the government of Pakistan to allow them to sell their goods in Pakistan.

According to a source in the Central Board of Revenue the decision would be announced shortly as a special case to allow the traders to clear their goods lying in Quetta, Chaman and Peshawar, respectively. The C.B.R. had allowed the Pakistan Railways to unload ATT goods at Quetta instead of Chaman because of US-led attack on Afghanistan. He said government was likely to give permission to the traders to clear their goods locally on payment of full duty. Explaining further, the official said that the traders would have to pay customs duty at 30 per cent, sales tax at 15 per cent and withholding tax at one per cent on all the ATT goods.

According to reports, besides large number of containers lying at Karachi port and hundred of Railways wagons at Chaman, Quetta and Peshawar, huge quantities of packed goods are lying at the Pak-Afghan border. As an invisible benefit of US led coalition attack on Afghanistan, transit trade has stopped which was the main source of smuggling in Pakistan and which was causing revenue losses of billion of rupees to Pakistan.

The issue of smuggling and transit trade are two sides of the same coin. Under an agreement signed in 1995, Pakistan have been providing trade facilities to the land locked Afghanistan. But this facility has been grossly misused. Many of the items imported in the name of Afghan Transit Trade (ATT) are not meant for sale in Afghanistan, but for marketing in Pakistan. Hence, during the supposed transit process these items make a U-turn to be sold in the local Bara Markets. Not surprisingly the items thus imported included things that are either unusable in Afghanistan like (air conditioners) or which have an extremely limited usage there as fabrics, including chiffon saree lengths that certainly have no place in Afghan women's sartorial habits, but were imported in large quantities for sale in Pakistan. ATT thus has been the biggest single source of smuggled goods on which our so-called Bara Markets thrive, and the local industry suffers. The problem has persisted mainly because of the Afghan government's failure to ensure that the trade facility does not turn into the illegal smuggling activity that it does.

The bulk of the ever growing volume of goods imported for Afghanistan not only found their way into border areas of this country, but also flood the markets in almost all cities where special bazaars have sprung up which freely sell a wide variety of smuggled goods at relatively low prices, driving the locally manufactured or legally imported items of the same kinds out of the market. Pakistan had always been generous to need of its landlocked neighbour to the point of sacrificing the interests of its own trade and industry and even paying a heavy price itself in terms of revenue losses. The extent of losses on this account can be seen, from the fact that during the last three years Afghan transit trade had recorded a phenomenal increase of about 300 per cent despite the absence of any revival in economic activity in that country.

Pakistan had been trying to check the overgrowing volume of imports under ATT by eliminating smuggling-prone items from the transit trade list. Import of 17 item was banned last year which included television sets, VCR video cassette, razor blade, juicers/blenders, tape recorders, dinner sets and etc. Pakistan wanted to eliminate 58 items from the list but the trade delegation of Taliban government did not agree, and perusing the policy of appeasement, government of Pakistan obliged them. But even that did not work as Afghan traders and their collaborators on this side of the Durand Line had succeeded in finding alternative routes for the import of goods which Pakistan has placed on the negative list.