Muhammad Soban

The export of different items from Pakistan to five Central Asian countries increased significantly during the first two months of the current fiscal, WealthPK reports.

According to the data released by the State Bank of Pakistan, exports from the country to Uzbekistan surged by 156% during the first two months of the current fiscal and reached $21.25 million as compared to $15.364 million during the corresponding period of the previous financial year.

Pakistan’s exports to Tajikistan also increased by 61.56% and reached from $269,000 to 435,000 in the first two months of the current fiscal.

Moreover, Pakistan’s exports to Kazakhstan surged by 38.36% and reached $21.2 million from $15.36 million during the first two months of the financial year 2022-23.

On a month-on-month basis, exports to Central Asian countries also witnessed an increase. The export of different goods from Pakistan to Uzbekistan surged by 156.01% in August 2022 and reached $9.7 million as compared to $3.5 million in August 2021.

Pakistan’s exports to Tajikistan also increased by 41% in August 2022 and reached $290,000 as compared to $205,000 in August 2021.

However, Pakistan’s exports to Kazakhstan slumped by 19% in August 2022.

Central Asia holds a great opportunity for Pakistan to increase its exports and strengthen its economy. The trade between Pakistan and Uzbekistan has significantly improved since the signing of the Preferential Trade Agreement and Transit Trade Agreement between the two countries.

The Pakistan-Uzbekistan Joint Working Group on Trade and Investment was established in May 2020 to increase the volume of trade between the two countries. A Transit Trade Agreement was signed in 2021 between Pakistan and Uzbekistan to improve transit trade.

Under the agreement, Uzbekistan’s entire trade will move from Iran’s Port Bandar Abbas to the seaports of Pakistan. It will link the seaports of Pakistan with Central Asian countries.

Pakistan and Uzbekistan signed a Preferential Trade Agreement (PTA) in March 2022 to reduce duties on 34 items, currently ranging from 20% to 100%. To minimise non-tariff barriers, standards should be followed and the procedural requirements should be eased for the goods covered by the PTA.

Pakistan still needs to devise a comprehensive logistics plan for transporting goods to the landlocked Central Asian countries. To explore the potential, stakeholders should ensure timely payments to Pakistani exporters by understanding the importance of formal payment channels.

Most of the Pakistani export items are transported through Afghanistan to Central Asian countries. The Afghan government restricts Pakistani transporters from directly sending their consignments to Central Asian countries from Afghanistan. The Pakistani transporters need to work with their Afghan partners.

As a result, Pakistani export items are smuggled to Central Asian countries or sent through Afghan trucks as an informal trade. The difficulties in the transportation of goods to Central Asian countries hinder trade with these countries that need to be removed for increasing Pakistan’s exports and strengthening the national economy, according to WealthPK research.

Credit : Independent News Pakistan-WealthPk