Torkham Border Closure: Trade Suspended
The Torkham border closure has significant implications for the regional economy, with trade losses mounting and businesses struggling to survive. A balanced approach that ensures both security and trade facilitation is necessary to resolve the crisis and support struggling businesses.
A border dispute between Pakistan and Afghanistan has led to the suspension of cross-border trade and transit, causing significant financial losses for both nations, with the Torkham border closure estimated to cause a loss of $1.5 million daily in exports and $2 million in revenue from imports.
The tension escalated after an exchange of fire injured eight people and damaged property, prompting a ceasefire agreement. However, talks between Pakistani and Afghan officials broke down when the Afghan delegation discovered that Pakistan had expanded its delegation list without prior consultation, adding 53 unnecessary members. The Afghan delegation left after waiting two hours, criticizing Pakistan's approach.
The border closure has caused a loss of $1.5 million daily in exports and $545 million in revenue due to suspended imports. Pakistani security officials have set conditions for reopening, including adherence to previously agreed protocols and agreements regarding construction activities on both sides of the border. Afghan delegates have reportedly refrained from renovating or reconstructing a controversial check post near the border zero point.
The President of the Pakistan-Afghanistan Joint Chamber of Commerce and Industry (PAJCCI), Junaid Makda, has urged the government to resolve the worsening trade crisis with Afghanistan and Central Asian countries. The crisis is attributed to rising trade barriers, increasing transportation costs, and the prolonged closure of the Torkham Border, which has disrupted cross-border business and caused significant losses to Pakistan's economy.
Sources expect cross-border trade and pedestrian movement to resume soon, with Pakistani and Afghan security officials holding a meeting with tribal elders after the Afghan side gave "positive signals" to reopen the Torkham border crossing. The PAJCCI has expressed deep concern for small and medium-sized enterprises (SMEs), warning that long delays and uncertainty are destroying trader confidence and deterring investors.