Mansoor Sadiq

Pakistan’s exports of motorcycles and tractors to Afghanistan have considerably increased during 2023, officials and vehicle dealers said. Following the economic resurrection, Afghanistan imported motorcycles from Pakistan in massive numbers. The dealers exported motorcycles at a relatively higher price, which brought temporary boost to Pakistan’s motorcycle industry from February to July, 2023. An official of Pakistan Customs said Afghan traders have imported over 5,000 motorcycles during the past four months, and the majority of these motorcycles are Honda CG125 and Honda CD70. Many other locally manufactured motorcycles are also exported to Afghanistan.

Sabir Sheikh, a senior office bearer of Association of Pakistan Motorcycle Assemblers (APMA), told WealthPK that Afghan clients are purchasing motorbikes from Pakistan at a premium price. Owing to exports of motorcycles to Afghanistan, Honda CG 125 motorcycles are in high demand, which is one of the main reasons behind increasing prices of Honda motorcycles in Pakistan, he said. It has also been learnt that Afghan buyers of CG 125 motorcycles are reportedly paying an additional Rs15,000 on top of the official sale price. These motorcycles cost about $1,000 each, and the local Afghan clients also purchase them in the US currency.

On the other hand, Afghanistan imported tractors worth $1.96 million from Pakistan during 2019, which have also increased significantly following the stability in Afghanistan. To further enhance bilateral trade, Pakistan has officially announced the implementation of a barter trade mechanism with Iran, Afghanistan and Russia on specific goods, including petroleum and gas. The aim of the barter trade system is to stabilise the economy of Pakistan by increasing foreign reserves and expanding trade opportunities, according to the Commerce Ministry.

Similarly, cement manufacturers in Pakistan’s northern region could make massive earnings as Afghanistan’s Ministry of Mines and Petroleum has announced reduction in customs tariff by $15/tonne and royalty fees by $5/tonne on exported coal. The total volume of bilateral trade between Pakistan and Afghanistan grew by 13% to $1.861.64 billion during the fiscal year 2022-23. The total volume of Pakistan’s exports to Afghanistan is estimated at $968.43 million during FY23, while imports at $893 million.

Pakistan’s economy will benefit from the commencement of barter trade between Pakistan and Afghanistan in shape of increased foreign reserves and expanded trade opportunities. Under the barter trade system, Pakistan will be able to export milk, cream, eggs, cereals, meat, fish products, fresh fruits and vegetables, rice, pharmaceutical products, chemicals, perfumes, cosmetics, plastic, rubber, leather, wood products and furniture items, textiles, paper, footwear, iron and steel, electric fans, motorcycles, tractors, surgical products, and sports equipment.

According to officials of the Commerce Ministry of Pakistan, all the participants should meet specific obligations, which include registering with Pakistan Single Window System, obtaining an import-export licence, submitting trade applications via the Federal Board of Revenue (FBR) online portal, and getting verification from the relevant Pakistani missions in respective countries.

Credit: INP-WealthPk