Author: #empowerpakistanbyazd

  • Central Asia and Pakistani Seaports: Opportunities

    Central Asia and Pakistani Seaports: Opportunities

    Amer Zafar Durrani, July 27, 2005

    Executive summary

    Pakistan’s seaports – chiefly Karachi Port (KPT) and Port Qasim (PQA) – are the natural maritime gateways for Afghanistan and the five land‑locked Central Asian Republics (CARs). Over the past three fiscal years (FY 2021‑22 → FY 2024‑25) the value and tonnage of transit and trans‑shipment traffic have been volatile, mirroring regional security conditions, Pakistan’s anti‑smuggling crackdown and the global freight cycle. Karachi still has ample spare capacity (2–3 M TEU of headroom) and its tariffs remain regionally competitive, which positions it to capture a larger share of Eurasian north‑south flows once rail‑road links beyond Afghanistan become reliable.

    Transit and trans‑shipment volumes (last three years)

    DestinationFY2021‑22*FY2022‑23FY2023‑24**TrendNotes
    Afghanistan (under APTTA)US $ 4.02 bnUS $ 6.71 bn ― +67 %US $ 2.89 bn ― ‑59 %Sharp reversal after Sept‑23 border & foreign‑exchange restrictionsValue of goods manifested for Kabul, not duties‑paid imports.
    All CARs (aggregate)~ US $ 220 mUS $ 250 m†US $ 181 m (Jul‑Dec 24)Gradual growth, then 17 % slide in 1H FY25Traffic split 55 % Uzbekistan, 20 % Kazakhstan, 13 % Tajikistan, balance TK and KG.

    *No single government source disaggregates CAR transit; the FY2021‑22 estimate uses PBS country‑wise export data plus adjustment for re‑exports.

    **Pakistans fiscal year (1Jul30Jun). FY2024‑25 figures are year‑to‑date.

    ***Back‑cast from nine‑month Kazakhstan figure of US$72.4m with proportional scaling to other CARs.

    Derived from Pakistani Ministry of Commerce monthly trade statements and TDAP briefings.

    Key take‑aways

    • Afghanistan still dominates Pakistan’s transit business, but the clamp‑down on smuggling cut volumes by half in FY 24.
    • Central Asian volumes are small but resilient; rail‑cum‑road pilot consignments (PAKAFUZ and TIR sealed trucks) moved 1,350 TEU in 2024, up from 420 TEU in 2022 (News Central Asia, IPRI).
    • Once the Termez–Mazar‑i‑Sharif–Torkham railway is finished (target 2027) freight could jump to 4–5 Mt p.a., according to Uzbekistan–Pakistan feasibility papers.

    Potential of Karachi as a Central Asian gateway

    IndicatorLatest figureCapacity after committed upgrades
    Container throughput (FY 2024‑25)2.65 M TEU> 5 M TEU once SAPT & KGTL phases 2–3 are online (2027)
    Bulk and general cargo54 Mt handled FY 2024‑25Quay‑wall extensions add 25 Mt under AD Ports 25‑yr concession
    Rail connectivityDaily 40‑wagon block train to Peshawar; pilot rail service to ChamanPlanned ML‑1 double‑tracking will cut Karachi‑Peshawar transit from 50 h to 28 h (financing secured 2024)
    Road corridorsN‑5, M‑1/2 motorways & CPEC Western Route; 45‑hr truck transit Karachi‑Torkham, 40 hr to -ChamanPeshawar–Kabul–Termez (PAKAFUZ) railway + TIR trucks expected to slash Karachi–Tashkent to 7 days door‑to‑door

    Assessment

    At current berth occupancy (≈ 55 %) Karachi could treble CAR throughput without new quays. Hardware is no longer the bottleneck; soft‑infrastructure (single‑window clearance, bonded trucking guarantees, and political stability in Afghanistan) will determine utilization.

    Port charges applicable to transit / trans‑shipment

    Charge type (Karachi and PortQasim)Typical rate (May2024 tariff)Concession/relief for transit cargo
    Container landing/handling (20’/40’) – general cargoPKR 26,050 / 36,720 (≈ US$ 93 / 131) at QICTSame as domestic import; no surcharge.
    ATT / AID Afghan container (20’/40’)PKR 13,600 / 20,800 (≈ US$ 49 / 75) – 48 % rebate vs ordinary boxesPlus 10 days demurrage‑free window.
    Port dues – foreign vesselUS$ 0.39 /GRT (KPT) after July 2024 fuel‑linked revisionNo rebate.
    Wharfage – bulk (grain/fertilizer)PKR 80–110 / t (KPT schedule)25 % refund if consignment is bonded for reexport within 30 days.
    Storage/demurrage after free time20’ box : PKR 2,400 per day first 5 days (≈ US$ 8.6)Same, but Afghan transit allowed 10 days free.

    Assessment

    Compared with Bandar Abbas and Jebel Ali, Karachi’s container handling cost for transit boxes is 18–25 % lower, offsetting slightly longer trucking distances to Central Asia.

    Could Pakistan allocate port land to Kyrgyzstan (as Iran did at Bandar Abbas)?

    • Legal mechanism – The Karachi Port Trust Act (Section 12‑B) and the 2021 Public-Private Partnership Ordinance allow long‑term concessions or exclusive zones to foreign governments / SOEs with Federal Cabinet approval. Recent precedents include the 25‑ and 50‑year concessions signed with AD Ports Group and CK Hutchison.
    • Available sites – East‑Wharf berths 18‑20 and parts of the back-up yard vacated after SAPT phase 1 are earmarked for third‑party logistics parks in the port master plan (2023). Approximately 20 ha could be fenced as a Kyrgyz bonded logistics enclave without impeding port expansion.
    • Diplomatic context – Islamabad–Bishkek Inter-Governmental Commission (Nov 2023) included a Kyrgyz request for “dedicated terminal space” but talks are at concept stage.
    • Feasibility – Technically straightforward; politically acceptable if structured as a commercial lease (avoiding sovereignty sensitivities). Unlike Iran’s freehold grant at Bandar Abbas, Pakistan would follow the “design‑build‑operate‑transfer” template now standard at KPT. Customs rulings already recognize “export processing zone” status, so Kyrgyz freight could enter duty-free and move inland under the TIR carnets.

    Conclusion

    Pakistan can replicate Bandar Abbas‑style access for Kyrgyzstan; success hinges on traffic guarantees (minimum 0.2 Mt p.a. is the break‑even volume KPT quotes) and harmonizing quarantine/security procedures.

    Major logistics providers serving the Pakistan–Central Asia corridor

    This list is based on desk research only and should be verified if required.

    CompanyCore service on CAR lane
    National Logistics Corporation (NLC) – Pakistan Army‑backed multimodal fleet of 5,000 trucks; pioneer of TIR runs from Kashgar to Kabul and KarachiHQ near Mai Kolachi, bonded yards at West‑Wharf
    Spinzer Logistics & Shipping Line – End‑to‑end forwarding, Afghan border clearance, PAKAFUZ pilot consignmentsKeamari (M‑1 Zahra Mall)
    CEVA Logistics Pakistan – Global 3PL; JV with local partner; runs weekly Kashgar‑Karachi TIR convoyRepresentation office, Port Qasim
    DB Schenker Pakistan – Rail‑road sea‑air products for CIS; leverages Istanbul‑Almaty block train and Karachi feederClifton
    Agility Pakistan / DSV – 700‑person operation; warehousing in Karachi, Islamabad, Lahore; offers project cargo to Uzbekistan & KazakhstanKorangi
    Hutchison Ports Pakistan (SAPT) – Operates Karachi deep‑water terminal; provides through‑billing to Central Asia via PAK‑Uzbekistan rail corridorSAPT berth 3‑6
    Karachi Gateway Terminal Ltd (KGTL) – New AD Ports/Kaheel JV; multipurpose quay with Central‑Asia logistics deskEast‑Wharf berths 6‑10
    TCS Logistics & Express – Dedicated B2B road & air freight; has flown charter freighters Karachi‑Tashkent for electronics shipments
    Tristar Transport (Agility affiliate) – Bulk liquids trucking Karachi‑Spin Boldak‑Termez; ISO‑tank depot inside Port Qasim free zone.
    SEATIME Container Line / GreenPak Shipping – NVOCC with regular SOC box repositioning for CAR clients

    Note: This article-report was prepared July 2025. All monetary figures in current US dollars unless noted.

    References

    A. Afghan transit‑trade statistics and trends

    1. “Afghan Transit Trade falls 84 pc amid anti‑smuggling efforts” – The Nation, 23 Sep 2024. (The Nation)
    2. “Pak‑Afghan Transit Trade Plunges by 59 % in FY‑24” – ProPakistani, 27 Aug 2024. (ProPakistani)
    3. “Pakistan’s Smuggling Squeeze” – Daily Times (op‑ed citing FBR data), 12 Jan 2024. (Daily Times)
    4. “Navigating the Impacts of Afghan Transit Trade on Pakistan’s Economy” – PEconomist, 15 Feb 2024. (Peconomist)

    B. Central‑Asian transit flows & trade

    1. “Pakistan’s exports to Central Asia drop 17 % despite transit trade agreements” – Profit by Pakistan Today, 6 Feb 2025. (Profit by Pakistan Today)
    2. Policy Brief: “Central Asian Trade, QTTA and the TIR Convention” – Islamabad Policy Research Institute, Nov 2024. (IPRI)

    C. Karachi Port capacity & performance

    1. “Karachi Port reports 23.43 % cargo‑handling surge in FY‑24” – PK Revenue, 9 Jul 2024. (Pkrevenue.com)
    2. KPT Tonnage & TEU Dashboard (interactive data portal) – Karachi Port Trust, accessed 27 Jul 2025. (KPT)

    D. Port charges & tariffs

    1. QICT General Cargo Tariff – effective 1 Apr 2024 (official PDF, 3 pp). (DP World)
    2. Statutory Notification SRO 522(I)/2023 – Revised KPT Port Dues (extract shows US$ 0.392 / GRT). (KPT)
    3. “KPT raises port charges after two decades” – Dawn, 5 Jul 2023. (Dawn)

    E. Concessions, master‑plan sites & expansion projects

    1. “AD Ports to deepen the Karachi Gateway Terminal” – Dredging Today, 22 Jun 2023. (Dredging Today)
    2. AD Ports Group press release: 50‑year concession for KGTL berths 6‑10 – 22 Jun 2023. (Adports Group)
    3. “AD Ports & Kaheel secure second Karachi concession (berths 11‑17)” – The Maritime Standard, 3 Feb 2024. (The Maritime Standard)
    4. MoU: AD Ports Group & Pakistan BOI on East‑Wharf industrial zone – 28 Feb 2025. (Adports Group)

    F. Inland‑connectivity projects

    1. Briefing Paper 05: “CPEC & ML‑1 Railway Project” – Pakistan Institute for Parliamentary Studies, Sep 2024. (PIPS)
    2. “Pakistan, China to finance ML‑1 in phases” – ProPakistani, 23 Oct 2024. (ProPakistani)
    3. “Trans‑Afghan railway expected to be completed by end‑2027” – Ariana News, 4 May 2024. (Ariana News)
    4. “Uzbekistan’s deputy minister announces Trans‑Afghan railway timeline” – Daryo.uz, 11 May 2024. (Daryo.uz)
    5. “Trans‑Afghan peace‑train pact puts trade over turmoil” – Asia Times, 22 Jul 2025. (Asia Times)

    G. Comparative precedent at Bandar‑Abbas

    1. “Iran to give Kyrgyzstan logistics site in Bandar Abbas Port” – Business Turkmenistan, 16 Dec 2021. (Business Turkmenistan Information Center)
    2. “Iran ready to host neighbours’ independent port authorities in Bandar Abbas” – Iran Daily, 4 May 2025. (Iran Daily)

    H. Kyrgyz‑Pak Inter‑Governmental Commission (IGC)

    1. Government of Pakistan press release: 4th Kyrgyz‑Pakistan IGC (Bishkek, 10 Nov 2023) – Economic Affairs Division. (Education And Development)
    2. “Pakistan, Kyrgyzstan underline need to strengthen bilateral cooperation” – DND News, 14 Nov 2023. (Dispatch news Desk)
  • Regional Security Concerns: Pakistan’s Response to US-India Ties

    Regional Security Concerns: Pakistan’s Response to US-India Ties

    Amer Zafar Durrani, February 21, 2025

    The United States and India Joint Leaders’ Statement issued on February 13, 2025, provoked strong reactions in Pakistan. Is it “much ado about nothing” or is it more a case of “where there is smoke, there is a fire?” Sifting facts from posturing is important. Pakistan needs to objectively assess its global standing without exaggeration or romanticism. The joint statement emphasized enhanced strategic cooperation between India and USA, focusing on counterterrorism, economic partnerships, and regional security. On the surface, this meeting underscored India’s elevated role in global supply chains and its deepening defense and technological collaborations with the U.S. Is this new?

    While the Modi administration hailed the recent summit as a success, independent analysts, including in India, observed that significant trade concessions and visa relaxations were not secured. Instead, the discussions predominantly centered on defense collaborations, notably the U.S. agreement to sell F-35 fighter jets to India. This development aligns with India’s defense modernization objectives but raises concerns about regional arms balance and potential military competition.

    The growing US India defense collaboration, though not recent, signifies an attempt at shifting South Asia’s military balance. India’s renewed pursuit of advanced defense systems, AI-driven military technology, and cyber capabilities through US partnerships and reshaping regional security dynamics. In this recent meeting the US agreed to sell 5th Generation fighter aircraft to India, a move that aligns well with India’s defense modernization objectives. The extended collaboration includes joint military exercises, intelligence sharing, and cooperation in areas such as space and cybersecurity. These initiatives aim to enhance India’s defense capabilities and ensure regional stability. However, this deepening defense partnership also raises concerns about the regional arms balance and potential military competition, particularly with neighboring countries like Pakistan and China.

    This is part of India’s ongoing strategic engagement with US initiatives, which are often prioritized by the US and, possible knowingly to the present Indian government, may not always align with Indian interests. Starting with the more innocent. The Indo-Pacific Economic Framework (IPEF) highlights the growing US-India cooperation in clean energy, digital trade, and supply chain security. Then to higher causes, particularly the India-Middle East-Europe Economic Corridor (IMEC) and the I2U2 initiative, comprising India, Israel, the UAE, and the US. IMEC aims to enhance trade efficiency and infrastructure investment, countering China’s Belt and Road Initiative. Concurrently, the I2U2 seeks to boost economic cooperation in sectors such as renewable energy, food security, and technology.

    The commitment by the US and India to increase bilateral trade to USD 500 billion by 2030 signifies a deepening economic partnership but also signals something deeper. Before going deeper, let us understand the India is already US’s tenth largest trading partner, with a total bilateral trade of slightly higher than USD 129 billion. Comparing, while the U.S. is among Pakistan’s top export destinations, Pakistan does not rank in any real standing among the top trading partners of the US. The fact that Pakistan’s total global trade, at slightly above USD 102 billion, does not even match the US-India trade, should beg a question. Why even try comparing or questioning?

    Let us seek the answer in more sinister possibilities. The US views India as a critical alternative to China for manufacturing and investment, attributed to its skilled workforce, expanding infrastructure, regulatory improvements, and growing stature, but still with low labor costs. India views these movements with the US as addressing its structural challenges, including foreign direct investment volatility and complex global trade regulations. These initiatives similarly underscore India’s strategic shift towards global trade integration and supply chain resilience, and a positioning that can also be viewed as natural, given its growth and development trajectory along with its geostrategic position and ideological, constitutional, and projected narrative.

    For Pakistan, these developments necessitate a proactive reassessment of its foreign policy including trade and connectivity strategies. Rather than adopting a reactive stance to India’s initiatives, Pakistan should focus on strengthening its trade networks within the Middle East, Central Asia, and other regions. This approach involves fostering bilateral economic alliances, investing in logistics and infrastructure, and leveraging regional trade frameworks to enhance its global positioning.

    Pakistan’s economic and foreign policy must transition from a reactive posture to one that actively seeks a massive realignment and diversification beyond the US and its “Iron Brother” China. This realignment must be seriously thought through and acted upon with alacrity. This is not simply a greater focus on investment and trade diversification or simply engaging further with regional economic coalitions.

    Security concerns in the region are high. Reports reveals that Tehrik-i-Taliban Pakistan (TTP) is now Afghanistan’s largest terrorist group, with growing support from the Afghan Taliban for cross-border attacks into Pakistan. This evolving security landscape underscores the necessity for comprehensive regional counterterrorism efforts. Pakistan’s policy responses should emphasize multilateral intelligence cooperation, robust counterterrorism frameworks, and initiatives aimed at economic stabilization to address these challenges effectively.

    Pakistan must adopt a pragmatic, forward-thinking approach to its foreign policy. The current shifts in global alliances present opportunities for defense and economic trade diversification, infrastructure development, and strategic partnerships. By strengthening diplomatic and economic ties with regional partners, investing in technology-driven trade strategies, and leveraging its geographic advantage, Pakistan can position itself as a key player in an evolving 21st century global dynamic. “Some are born great, some achieve greatness, and some have greatness thrust upon ’em.” So said Malvolio in Twelfth Night, Act 2, Scene 5. Pakistan please don’t be Malvolio!

    Note: This article was first published by The News International Pakistan, please don’t be Malvolio, in Pakistan.

  • Childlike naivete – retain it

    Charles Baudelaire espoused the antithesis of then middle-class values of materialism and conventionality as being “naivette,” or simply put naivete. Interestingly, the bourgeoises and their fondness for tradition in an industrial age, an age of science and discovery, often formed a barrier in pursuing a childlike curiosity towards the world, nature, and one’s own self. The latter is to me a synonym to “being a child at heart.”

    To retain the sincerity and unpretentiousness in contrast to the complexity and alienation in urban life which most of us encounter these days is nothing but a relief if used to one’s advantage.

    Keeping one’s inner child alive is probably the best source of positivity and wonder that can help traverse the complexities of an otherwise often ponderous and overbearing ritual of living.

    So, do not lose that kid – keep him or her alive!

    Daily writing prompt
    What does it mean to be a kid at heart?
  • Equity and Grid Stability: Reconsidering Household Net Metering in Pakistan

    Amer Zafar Durrani, President, Reenergia and Komal Kenneth Shakeel, Senior Economist, Reenergia

    We wrote about household solar and its adoption in Pakistan last year and since, many a storm has erupted on the local landscape on this issue coupled with net metering. Net metering is a typical policy area where countries like Pakistan are best served to wait till all research has been done in the local context and a public consensus built around the pros and cons. Pakistani government, like it did in the case of IPPs went headlong without the pre-requisite policy research, debate, and consensus building to implement net-metering. Immediate ‘wins’ were celebrated.

    The fundamental issue being ignored is the experience since this being introduced in USA in the 1980s showed that the net metering required countries to be open to the public and to themselves about how they will balance the two core variables of ensuring energy equity and maintaining grid stability—requiring dynamic and localized policies rather than a single brush country wide application, like Pakistan does from GB and Chitral to Tharparkar and Gwadar. When power corridors of a country live in a small village across its border, called Islamabad, this happens often.

    Generally, net metering policy allows households (and others) drawing electricity from a centralized grid through the local energy supply company (ESCO) and producing their own renewables-based electricity to sell the excess electricity back to grid thereby reducing their electricity bills. This was first introduced in Minnesota in the USA in 1983, and since started being viewed as a local panacea for reducing the weight on consumers’ wallets. This bubble started bursting within a few decades as widespread utilization gained favor . The fact was that only the relatively rich had money to become independent power producers based on renewable technologies, and the many power plants supplying the central grid needed payment for their operations and production or the plants would shut down. In fact, the reason why net metering was invented was precisely why the plants could not shut down.

    Electricity once generated, and without storage, must be used or gets wasted. Initially policy makers saw the excess household energy to cater to an ever-growing demand for electricity by allowing excess ‘clean’ electricity from households (and others) to enter the central grid. Multiple issues followed. As localized energy from households grew the grid wanted to buy less from the power plants. The power plants could not produce as they had been installed for being efficient producers at certain capacities and without regular payments, they could not keep up operations. I am sure you will start seeing the mess being created. There were issues with keeping the central grid stable with multiple producers sending to and drawing electricity from it—though Pakistan never entirely got there.

    Pakistan was already reeling from our so called “Power Sector Debt” also famously called the “Circular Debt,” when this policy was introduced, not realizing that with the state of the sector the mess would be amplified if this policy was adopted across the board. This is where we stand today.

    All this has happened without the Pakistani policy makers realizing that many a country around the world have been reconsidering net metering policies for the following reasons, including the USA. Households (and organizations) with low-incomes cannot afford their own electricity nor participate in net metering schemes—voiding governments’ primary responsibility is to uphold equity. Grid stability is difficult to maintain with so many folks trading and even the most modern of grids struggle at some point. The electricity generators, the IPPs, are not running systems that can be turned on and off within days and need to maintain generation fuels’ supplies—all requiring healthy cash flow. They cannot even be told to shut down as the renewable sources of energy cannot maintain a twenty-hour load profile specific supply without storage and or IPPs supplying to the grid.

    From USA to Africa to Australia, countries are looking at agile policy making and dealing with net metering on a localized level instead of single brush policies applicable to deal with the issues arising from haphazardly implemented net metering policies. Policies can include developing localized polycentric solutions such as richer local producers (households and others) supplying excess back to localized grids serving the proximate poorer households (and other users); earning social service and impact points from the government. No matter what policies are being adopted, household net metering is no longer the ‘darling’ of any government or policy maker and measures are being adopted to ensure equity and grid stability.

    For Pakistan the challenge is amplified as the contracts with central IPPs are already a burden on the masses. In such a situation, there is a need for such policies on electricity to be shifted to provincial and local levels (when we have these officially) with careful planning at ESCOs’ level to ensure a win at each location. Hence it is not simply a matter of saying we have 6,000 MW of self-generated renewable electricity available, rather ask where they are concentrated. Otherwise, this elite lobby will force itself on the broader policy making agenda of the Pakistani government, subverting the lesser privileged.

    May 14, 2024, Islamabad, Pakistan

    This article was first carried by The News in Pakistan, https://www.thenews.com.pk/print/1189821-net-metering-fallout

  • Afghans in Pakistan

    Yes, Afghanistan as a nation state has never really accepted Pakistan. But, why so? One lens through which to look at this hesitance from Kabul is the creation of the Durand line without the consent of the Afghanistan state. The natural demographics and geography of Pakistan and Afghanistan have since long, pointed at how the equilibrium lies in a confederation of the two nation-states. Both equilibrium and the history of Afghanistan and Pakistan relations since 1947 aside, calling out Afghans refugees in Pakistan, is like tearing the heart out from the very concept of Pakistan. It is a counterproductive strategy.

    Diplomatic troubles and travails aside, with the provision for the autonomous regions along the border of Afghanistan, Pakistan simply and informally moved its revenue territory inwards and allowed a free movement of Afghans and Pakistanis till the penultimate Soviet incursion into Afghanistan. Goods, likewise, were allowed to move to and fro, even before the UN Convention on the Law of the Seas.

    The 1979 Russian armed incursion in Afghanistan resulted in the first mass exodus of Afghans into Pakistan, with Pakistan hosting a peak of almost 6 to 7 million Afghans at one point in the early 90s which was then, followed by their return until 1999-2000. From 9/11 onwards and till the advent of the second (2.0) Taliban rule in August of 2021, the Afghan population in Pakistan oscillated between periods of moving into Pakistan and  returning back to Afghanistan—(barring a small peak inwards towards Pakistan in 2006-07)—mostly reacting to perceived local and often national economic conditions.

    Right after Taliban 2.0 in 2021, the number of Afghans entering Pakistan surged drastically. In this recent wave, Afghans fled due to fears of persecution and the perils of life under an extremist regime which to them, guaranteed no rights or rule of law in the manner they had grown accustomed to during the two decades under the US led coalition forces.

    Despite more than four decades of dealing with the waves of Afghans entering and residing and returning, Pakistan’s track record on the governance of the Afghans in Pakistan continues to be as it has always been – notoriously poor, mostly reactive and lead by security understandings and misguidance. An argument can be made that governance on the Afghan question was on par given Pakistan’s overall record of poor governance since 1947. Pakistan was simply unable to capitalize on the definite goodwill generated during the first exodus of Afghans and thereby continued to and continues to stumble today.

    In truth, the Pakistan government never looked at the issue of Afghans in Pakistan holistically or outside reactionary lenses which varied from humanitarian considerations to security. Afghans in Pakistan who were legally registered or were granted visas were largely allowed to operate economically and socially without any legal cover as long as it benefitted the interests of certain elements of the state or those of host communities. Elite Afghans also capitalized on this informality and worked hand-in-glove with their hosts for their own benefit—often at the cost of their fellow common Afghans in Pakistan. Yet on matters of identity, mobility, work, and social security for Afghans in Pakistan, the state protected its real interests through short-sighted approaches.

    Economically, Afghans in Pakistan contributed to the larger national economic pie but could’ve made better use of the formal economy if they were granted financial inclusion, and formal trading and connectivity rights. The current woes on currency and assets and illegal economic transboundary transactions could’ve also been dealt with and security matters ring-fenced much easier had this been legally allowed from the onset. However, the reactionary and shortsighted governance from Pakistan has much to account for both Pakistani and Afghan citizens.

    Despite all this, the Afghans like most traditional migrant communities in Pakistan worked hard and delivered for their host country—albeit invisibly, due large segments of the Pakistani economy being undocumented. For example, the labor market, especially in waste disposal, construction, sales, carpets, gems and jewelry, handicrafts, retail, culinary, and transportation would not have been robust or thrived without Afghans in Pakistan. However, the mixed economic effects felt by certain populations and mostly by the state were due to them being confined to the informal. As a result, Pakistani labor was the first affected by this treatment.

    The fact is that Afghan labor, like most migrant labor elsewhere, always undercut local labor in price while delivering better productivity and skills—raising concerns amongst locals [reminds one of the stories of the Polish immigrants in UK] who in turn impacted national sentiments unwillingly, while not realizing that the fault lay solely with the state of Pakistan. An even sadder impact of this informality was borne by Afghan women and girls in Pakistan whose wages were undercut, and their labor exploited easily by greedy male Afghan intermediaries and Pakistani host families. The Afghan women labor participation rate in Pakistan has always been substantially above that of their hosts, given the poor female labor participation locally within Pakistan.

    Then one should talk of fresh and dry fruits, pharmaceuticals, renewable energy, recycling, and the electronics sector in Quetta. Also, carpet weaving, gemology, and transportation industries in Peshawar. Real estate investments in the capital Islamabad to other key cities like Karachi, to introduction of new trends and designs to local markets makes it evident that Afghans in Pakistan have benefitted from joint ventures and partnerships with local host communities. However, the state of Pakistan due to its shortsighted policies has only lost in the longer run, be it GITA (Goods In Transit to Afghanistan) trade or its desire to have strategic depth in the east.

    This present forced displacement will bear out no different. The memories of Sikhs being evicted in the name of partition by local vested interests in Rawalpindi in 1947 who only acted in self-interest and not that of the birthing state of Pakistan has come back to haunt the country. Are the Afghans being asked to leave Pakistan today suffering the same fate?

    Sadly, all signs point to it. The state of Pakistan may have legitimate reasons, though throwing the baby out with the proverbial bath water is hardly a sensible decision for Pakistan’s overall security. Then there are also unresolved questions about the treatment of women, children, and the elderly in this forced journey back to Afghanistan, only to be complicated further by what awaits them on their perilous journey back home. Time is ripe to have this debate while keeping eyes wide open in the primary interest of Pakistan. More on this in a more detailed article, that Initiate Asia is working on.

    Note: An abridged and edited version of this article was earlier published in the “The News Pakistan” [https://www.thenews.com.pk/print/1130882-the-afghan-refugee-question] in November 2023.

    Two Reports by Reenergia LLC [www.reenergia.com] on a) intrinsic economic value of Afghan Refugees in Pakistan and b) opportunities for returning Afghan Refugees in Afghanistan, both completed prior to COVID-19, 2020, informed this article on economic issues.