Prolonged Border Shutdown Slashes Pakistan-Afghanistan Trade by $1 Billion, Pakistan Chamber Warns

ISLAMABAD – The Pakistan-Afghanistan Joint Chamber of Commerce and Industry (PAJCCI) has issued an urgent appeal to the government, warning that prolonged and repeated closures of key border crossings have slashed bilateral trade by nearly $1 billion, pushing businesses to the brink and threatening the livelihoods of millions.

In a letter sent to Pakistan’s Ministry of Commerce, the Federal Board of Revenue (FBR), and customs authorities, Junaid Maqda, the head of the chamber, detailed the escalating economic crisis. He urged Islamabad to take immediate action to restore trade flows, which he stated have the potential to exceed $5 billion annually under stable conditions. Currently, due to persistent disruptions, that figure has plummeted to less than $1 billion.

A Crisis Triggered by Security, Compounded by Economics

The current trade paralysis stems from a major border shutdown initiated on October 11, following armed clashes between Pakistani security forces and the Taliban-led Afghan government. The closures at the critical Torkham and Chaman crossings—the two main trade arteries—have halted the transit of thousands of shipping containers. These containers carry not only essential goods for Afghanistan but also transit cargo destined for landlocked Central Asian countries, a key element of Pakistan’s regional trade strategy.

The financial toll on Pakistani businesses is mounting daily. With shipments stranded, truck owners are facing exorbitant storage fees, reportedly paying up to $200 per day per container. This has created a cascading effect, crippling traders, logistics companies, and ancillary industries that depend on cross-border commerce.

Regional Shifts and Deepening Isolation

The economic fallout is compounded by a shifting regional landscape. In a move that signals growing frustration and a search for alternatives, the Taliban’s deputy minister for public health recently banned the import of medicines from Pakistan, urging Afghan traders to source from other countries.

Simultaneously, Afghan authorities have been actively pursuing new partnerships to bypass Pakistan. A recent agreement with Uzbekistan to export Afghan agricultural products by air to markets in Central Asia, South Asia, and Europe underscores a strategic pivot that could permanently erode Pakistan’s role as a primary trade route for Afghanistan.

An Urgent Plea for Balanced Policy

Maqda emphasized that the chamber fully recognizes and supports Pakistan’s legitimate national security concerns, which are often the cited reason for the border closures. However, he stressed that the economic pressure has reached a critical level.

“The livelihoods of millions of Pakistanis—from traders and transport workers to customs officials and daily wage laborers—are intertwined with this trade,” Maqda stated in the letter. “While security is paramount, a sustainable solution that balances security with economic stability is urgently needed. The current policy of prolonged closures is proving to be a self-inflicted economic wound.”

Calls for Immediate Government Intervention

The PAJCCI has proposed several immediate measures to alleviate the crisis:

1. Prioritize Afghanistan-bound Shipments: Establish a dedicated and expedited process for goods destined for Afghanistan to clear customs during brief border openings.

2. Financial Relief for Exporters: Implement a mechanism to provide immediate relief on demurrage and detention charges for the thousands of stranded containers.

3. Formalize a Contingency Protocol: Develop a clear, transparent protocol for border management that minimizes trade disruption during security incidents, rather than resorting to complete shutdowns.

The chamber warns that without swift government intervention, Pakistan risks not only severe domestic economic damage but also a permanent loss of its strategic position in regional trade networks, as both Afghanistan and Central Asian nations accelerate their efforts to find alternative supply routes.

 

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