In a region where geography offers a natural advantage for trade, Pakistan and Afghanistan have long struggled to translate proximity into prosperity. However, the recent implementation of a bilateral Early Harvest Programme marks a pivotal opportunity to turn the page.

The programme is effective from August 1, 2025, to July 31, 2026, under which both countries will offer mutual tariff concessions on key agricultural goods. Pakistan will reduce duties on Afghan tomatoes, grapes, pomegranates, and apples, while Afghanistan will cut tariffs on Pakistani potatoes, bananas, quinoa, and mangoes.

Although reduced, duties will remain between 22 percent and 27 percent, allowing continued revenue collection. The programme is expected to boost bilateral trade and serve as a foundation for negotiating a more comprehensive preferential trade agreement in the future. With reciprocal tariff concessions on key agricultural exports now in effect, the two countries have taken a tangible step toward a more stable and mutually beneficial economic relationship.

Pakistan once commanded nearly 80 percent of Afghanistan’s import market, an unrivaled position rooted in geographical proximity, shared borders, and cultural ties. However, that dominance has steadily eroded in recent years. Bilateral trade, which peaked at USD 2.86 billion in 2011, declined sharply to USD 1.39 billion in 2020 before partially recovering to USD 2.17 billion in 2024.

This downward trend highlights the need for renewed and structured engagement. The recently launched Early Harvest Programme in the agricultural sector is a timely and encouraging initiative, and similar sector specific programs particularly in manufacturing, construction materials, and pharmaceuticals could serve as important mechanisms to revive and expand trade ties. If successfully implemented, such initiatives could help restore Pakistan’s foothold in the Afghan market and build a resilient bilateral trade architecture.

Despite the promise of enhanced connectivity and mutual prosperity, trade between the two nations remains constrained. Rather than emerging as a dynamic conduit between South and Central Asia, the bilateral relationship continues to be hampered by policy fluctuations, limited trust, and underutilized potential.

Over the past two decades, trade between Pakistan and Afghanistan has shown considerable fluctuation, reflecting the evolving........

© Business Recorder