Afghanistan’s Ban on Trade in Pakistani Rupee May Fail

Posted on Posted inPakistan, World

KHOST CITY; Dec 16, 2018 — Afghan authorities on Sunday, in a bid to increase circulation of local currency, decided to ban trade in Pakistani rupee in southeastern Khost province.

The move by provincial governor Hakam Khan Habibi aims to counter the use of Pakistani currency in local markets.

Following the move, many young people in Khost rallied to urge people to buy and sell goods only using their own currency, afghani. Afghans say they face lots of problems while trading in Pakistani rupee, specially when the dollar rate increases or decreases.

Talib Mangal, the governor’s spokesman, told Pajhwok Afghan News that a commission has been created to implement the plan to promote transactions in afghani instead of Pakistani rupee.

However, civil society activists say the plan has failed to achieve the objective so far. Many traders on both sides of the border say they would continue trading in Pak currency despite warnings.

“Anyone violating the decision would be referred to judicial organs,”  warned Talib Mangal, the governor’s spokesman, who told Pajhwok Afghan News that a commission has been created to implement the plan to promote transactions in afghani instead of Pakistani rupee.

While Afghanistan shares a common religion, race, history, ethnicity and geography with Pakistan, bilateral relations have always been strained. Pak-Afghan trade volume, despite having a potential of $5 billion, has fallen from $2.5 billion to $1.4 billion.

However, despite the troubled times, Pakistani ports of Karachi and Gwadar are still the most economical routes for Afghan transit trade.

In May, Pakistan had formally reopened the Ghulam Khan crossing point — a major trade route with its landlocked neighbor after nearly four years.

The ongoing fencing of Pak-Afghan border by Pakistan’s military is part of ‘border management’ system which will not only deter terrorists and smugglers from crossing the border but will also regularize land-based trade and transit facilities.

The Ghulam Khan post is one of the eighteen border crossing points between the two countries that connects Pakistan’s North Waziristan tribal region with Khost province of Afghanistan. It is also the third-largest official crossing point on the nearly 2,600-kilometer, mostly porous frontier between the two countries–by the end of 2019, the double fencing of the entire length is expected to be completed.

The route serves as the shortest one from Karachi to Kabul, reducing the total distance by more than 400 kilometers, as compared to Torkham.

Authorities had closed the remote Ghulam Khan border crossing in North Waziristan in 2014, after launching a major army-led counter-militancy offensive in the tribal belt, once condemned as “the breeding ground for international terrorism”.

The border region which is seeing major reconstruction is all set to become the northern hub for enhanced bilateral trade and formal transit facilities–part of regional connectivity Pakistan, China and Afghanistan have in mind.

The three nations on Saturday signed a Memorandum of Understanding (MoU) over anti-terrorism cooperation between them in Afghan capital Kabul.

The MoU was signed by Foreign Minister Shah Mehmood Qureshi, Chinese Foreign Minister Wang Yi and their Afghan counterpart Salahuddin Rabbani.


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