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Pakistan-Afghanistan trade slumps after Taliban takeover in sign of troubled ties

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Contrary to initial euphoria, trade between Pakistan and Afghanistan slumps

Notwithstanding the initial euphoria after the US exited Afghanistan last year, trade between Islamabad and Kabul has slowed down. Khyber Pakhtunkhwa Chief Collector (Customs) Ahmad Raza Khan has revealed that the fragile economic situation in Afghanistan has led to a 25 per cent decline in Pakistan's exports to the country in the last six months.

According to reports, the State Bank of Pakistan had imposed a new policy of exports to Afghanistan on 13 December that mandated Afghan traders to show US dollars along with their passports at the time of entry to Pakistan to acquire Form-E for buying and importing Pakistani goods to Afghanistan, the Business Standard said.

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The news organization added that the new SBP trade policy was meant to lure Afghan traders to bring American dollars to Pakistan and thus, increasing Pakistan's foreign exchange reserves to improve its economy.

In October, Karachi based the Dawn said that the flow of “Afghan transit trade and Pakistan’s exports to Afghanistan saw a deeper drop since the Taliban took control of Kabul in August.” “Afghanistan is cash strapped at this point, how can trade flourish? It is however possible that Pakistan is sending goods as aid,” an analyst told India Narrative.

In September, Anadolu Agency said that trade between the two neighbours increased following since the Taliban took control.