Pakistan and Afghanistan are likely to overcome the last hurdle in the smooth execution of the newly-signed transit trade treaty between both the neighbouring countries within the next two weeks by finalising details of the installation of biometric system and tracking devices on transport units.
The Afghanistan Pakistan Transit Trade Agreement (APTTA) 2010 was signed by both countries on October 28, 2010. This agreement has replaced the transit trade agreement of 1965. The APTTA was operationalised on June 12.
An official source said most of the provisions under the agreement had been implemented but the installation of biometric system and tracking devices on transport units. He said the Federal Bureau of Revenue (FBR) and the Ministry of Interior were sorting out the issues.
He said currently the FBR was in the process of selecting suitable firms for monitoring and tracking of transit cargo across the country on a real time basis. All the required codal formalities had been completed and it was expected that the firm, most suitable both technically and financially, would be mandated to operate the tracking system, within two weeks time.
According to the source, the Interior Ministry would soon hold a meeting with Afghan authorities in Kabul on the installation of a compatible biometric system at Torkham and Chamman borders to resolve the matter.
According to the provisions of the agreement, an insurance guarantee equal to the amount of import levies of Pakistan had to be deposited by the importer with the customs authorities for the clearance of transit goods. However, the said provision was suspended for three months, as insurance companies in Pakistan were not prepared to provide insurance guarantees for the transit goods.
The new agreement is based on the principle of full reciprocity. Whatever facility is extended by Pakistan to Afghanistan under the agreement, will be reciprocated by the Afghan side. No exemption is granted except the suspension of equipment of providing insurance guarantee for three months. This has been restored since October 13, 2011.
Various studies and reports highlighted the limitations of the transit treaty of 1965. The APTTA was negotiated keeping in view the shortcomings of the previous transit agreement, input received from public and private sectors stakeholders and best international practices.
The main concern for Pakistan was the issue of smuggling in the garb of transit trade. The new transit treaty has addressed this issue and the following measures have been placed to prevent the misuse of the transit facility.
Under the plan, tracking device on transport units would be installed and the customs-to-customs information would be shared through data transfer of information technology and others.
The provision of financial guarantees equal to the amount of import levies of Pakistan would be deposited by authorised brokers/custom clearing agents, which shall be released after the goods exit the country.
