Under the transit agreement, Afghan trucks carrying goods for the Indian market have to stop in Peshawar and unload there, and Pakistani vehicles carry the freight onwards. Afghan traders and officials prefer their own vehicles to be able to drive straight through Pakistan to the Indian border because transshipment results in avoidable losses, and even pilferage.  

Landlocked Afghanistan depends traditionally on Pakistan for its access to international market.  And historically Pakistan has been using transit trade facility as leverage to pressurize Afghanistan.  “Pakistan uses transit agreements as leverage for exerting pressure on Afghanistan, so we don’t believe the problem will be solved even after cash guarantees have been paid,” Mohammad Qurban Haqji, chief executive of the Afghanistan Chamber of Commerce and Industries, said. According to Afghan traders, their import and export consignments are still being held up in Pakistan.

A source at Pakistan’s embassy in Kabul, who asked to remain anonymous, told IWPR reporter  Khan Mohammad Danishju (Institute for War & Peace Reporting, IWPR, is UK based charity ) that the guarantees were needed to ensure that Afghan traders in transit travelled along pre-determined routes and did not sell their goods or sell their trucks inside Pakistan.

The source added that Pakistani president Asif Ali Zardari had given Afghans a grace period of three months to enter Pakistan without furnishing guarantees, and Prime Minister Yousaf Reza Gilani had extended this to six months. The claim is disputed by Afghan trade chambers.

Khan Jan Alokozay, deputy head of the Afghan chamber of commerce, contends that in practice, this right had been extended to only 40 trucks, while another 300 carrying goods for export were still stuck in Peshawar. He complained that imported consignments were also being blocked for months on end at Karachi port.  Alokozay estimates the truck loads (of imported goods) held up at Karachi port at anywhere between 4,000 and 4,500.

“As a result of obstacles created by the Pakistani government, 4,000 to 4,500 truckloads of [imported] goods are held up in Karachi right now,” he was quoted as saying in an IWPR dispatch. “Pakistan is not allowing traders to bring these goods into Afghanistan. And the Pakistani government has imposed additional taxes and tariffs of between 3,000 and 10,000 US dollars on each of the containers.”

The issue acquired a new dimension – shortages in the domestic market.  Afghan trade minister Anwar-ul-Haq Ahadi told a news conference in Kabul, “If essential items are not brought from Pakistan, prices will go up and people will face many challenges”.

Reports from Kabul say that prices have already begun to shoot up, adding to the miseries of the war ravaged but sturdy Afghans. The shop keepers are making a killing as always, claiming that their goods haven’t arrived from Pakistan.

Trade analysts see no end to the problem – in the short or long run. Pakistan will not give up its tactics and it will like to gain through trade what it could not diplomatically and strategically.   So, trade remains another dimension of Pakistan’s strategic depth policy beyond the Durand Line. Afghans find the restrictions unfair since Pakistani traders have virtually a free run in the growing Afghan market.

In such a situation, Afghan trade and industry must consider alternative routes. Much like the Americans, who are turning away from Pakistani land route to ferry the essential NATO supplies. While the US likes to depend on the Central Asian States for meeting its transport needs, Afghanistan will do well to explore both options – CAS and Iran. Trade through Iran will have the advantage of maritime access.

India has built a 200 km (124-mile) highway that links Heart, Kandahar and Kabul with Zaranj on the Iranian border. The highway that takes off from Delaram in the southwest Afghan province of Nimroz is the centerpiece of a $1.1 billion Indian re-construction effort in Afghanistan. It was completed at a cost of about $ 85 million and was thrown open to traffic in January of 2009. Indian companies have built some 700 kms of roads mostly in the western and northern regions of the country.

On the Iranian side, there is already an existing road connecting Zaranj with Chah-bahar, which is a free trade zone in the south-east of the country. Chah-Bahar has two jetties – Shahid Beheshti and Shahid Kalantari facing the Sea of Oman. and they handle general cargo, containers and tankers. These Jetties are situated on the eastern shore of Chah-Bahar Bay, 112 km. from Iran-Pakistan border.