Afghanistan is in a race against time to find new trade partners after a deadly border clash with Pakistan last month sent bilateral relations to a new low, severely impacting communities on both sides of the frontier.
Economic Fallout from a Bitter Dispute
The South Asian neighbours have been embroiled in an increasingly hostile dispute ever since the Taliban assumed control of Kabul in 2021. Islamabad has consistently accused the Afghan government of sheltering militants responsible for cross-border attacks, allegations which the Taliban administration strongly denies.
The situation escalated dramatically on October 12, when deadly cross-border fire led to the closure of the frontier. This left dozens of Afghan trucks stranded with their cargo of perishable goods rotting. The incident was followed by a fragile truce, but the economic damage was already done.
According to the Pakistan Afghanistan Joint Chamber of Commerce and Industry (PAJCCI), the losses have exceeded $100 million for both nations, with up to 25,000 border workers affected.
A Scramble for Alternative Routes
In response to the crisis, Abdul Ghani Baradar, Afghanistan's deputy prime minister for economic affairs, explicitly urged traders last week to shift their business away from Pakistan. "Redirect their trade toward other alternative routes instead of Pakistan," he warned, adding that Kabul would not intervene to assist those who continued to rely on the problematic partnership.
Pakistan is a crucial partner for landlocked Afghanistan, being its top trade connection. It supplies essential items like rice, pharmaceuticals, and raw materials. In return, Pakistan absorbed 45 percent of all Afghan exports in 2024, as reported by the World Bank. Alarmingly, over 70 percent of those exports, valued at $1.4 billion, are highly perishable agricultural products such as figs, pistachios, grapes, and pomegranates.
Wary of further disruptions, the Taliban government is now actively hedging its bets. Trade with Iran and Turkmenistan has seen a significant surge, jumping 60–70 percent since mid-October, according to Mohammad Yousuf Amin, head of the Chamber of Commerce in Herat. In a landmark move, Kabul also sent shipments of apples and pomegranates to Russia for the first time last month.
Broader Implications and Human Cost
The vast market in India is another prime attraction for Afghan traders. In a clear push to facilitate this trade, state-owned Ariana Afghan Airlines slashed its freight rates to India, and Kabul dispatched its commerce and industry minister to New Delhi for talks.
Economic analyst Torek Farhadi, a former IMF adviser, highlighted the urgency of the situation. "Afghanistan has too many fruits and vegetables it cannot store because there are no refrigerated warehouses," he said. "Exporting is the only way," he told AFP, emphasizing that it must be done quickly before the produce spoils.
While Kabul promotes Iran's Chabahar port as a strategic alternative to Pakistan's southern harbours, Farhadi pointed out that this route is longer, more expensive, and complicated by US sanctions on Tehran.
The human cost of the closure is stark. In markets in Peshawar, near the border, Afghan produce has almost disappeared. The AFP found that grape prices have quadrupled, and the cost of tomatoes has more than doubled. The PAJCCI has urgently called on Islamabad to act, warning that thousands of shipping containers bound for Afghanistan and Central Asia are stuck in Pakistan, accruing massive port charges.
The standoff has left individuals like truck driver Naeem Shah in dire straits. Stranded at the Pakistani border town of Chaman with a load of sugar and cooking oil, the 48-year-old told AFP, "I haven't been paid for a month... If it doesn't reopen, we will be distraught." Despite the animosity, analysts like Farhadi believe a resolution is essential: "It's better for both countries to end this trade war... They need each other."
