Islamabad is finalising plans to allow the export of six types of Pakistani goods to central Asian republics via Afghanistan on a six-month trial basis. Cement, rice, pharmaceuticals, glass sheets as well as certain pipes and hardware items will be zero-rated for sales tax and eligible to normal duty drawbacks.

The Pakistani authorities appear to have resisted calls to allow exports via Afghanistan of around 100 types of goods and have recommended that transactions and shipments in the trial scheme be strictly monitored.

Goods must be paid for by irrevocable letter of credit or by foreign currency in advance. To further prevent abuse of the scheme, Pakistan should use its diplomatic offices in Kabul and Kandhar to verify the arrival of goods in Afghanistan. If goods are diverted and sold without reaching their supposed destination, the scheme should be discontinued.

The Pakistani ministry of commerce also recommended to the Economic Coordination Committee (ECC) that goods in transit under the scheme must be clearly labelled and shipped only by government-approved transporters. The ministry submitted its recommendations in November to the ECC which makes the final decision on the scheme.