India and Afghanistan could firm up an air corridor connectivity project to enable the landlocked country to trade with India, the biggest country and market for Afghan goods in South Asia, given that Pakistan has refused direct trade between the two countries through its territory.
The proposal, which entails transport of goods as air cargo between one or two cities in Afghanistan to one or two destinations in India, could come up in a meeting on Saturday between Afghan president Ashraf Ghani and Indian Prime Minister Narendra Modi.
Afghan President Ashraf Ghani and Prime Minister Narendra Modi will be meeting in the city of Amritsar, a short distance from the Pakistan border, for the Heart of Asia conference aimed at stabilising Afghanistan.
Officials say the focus of the air cargo service is to improve landlocked Afghanistan’s connectivity to key markets abroad and boost the growth prospects of its fruit and carpet industries while it battles a deadly Taliban insurgency. Afghanistan depends on the Pakistani port of Karachi for its foreign trade. It is allowed to send a limited amount of goods overland through Pakistan into India, but imports from India are not allowed along this route.
Afghan director general for macro fiscal policies Khalid Payenda said the potential for trade with India, the largest market in the region, was far greater than allowed by land and so the two countries had decided to use the air route. "That would be air cargo between Afghanistan and India. We have a lot of potential for trade on both sides. On our side, it’s mostly fruit and dried fruit and potentially through India to other places for products like carpets and others.” He said that a joint venture involving an Afghan and an Indian cargo firm would be set up and that the two governments were working to set up infrastructure at Kabul and Delhi airports.
Indian foreign ministry official Gopal Baglay, who oversees Afghanistan, Pakistan and Iran, said several proposals were being discussed to improve Afghanistan’s trade and transport links. "There have been very many ideas on how to enhance connectivity, overcome current challenges and also expand the trade basket,” he said.
The Attari-Wagah border between India and Pakistan is less than 30 kilometres away from Amritsar. India is expected to use the Heart of Asia conference to separately press Islamabad to allow trucks, carrying goods from Afghanistan that transit through Pakistan, all the way to India and other south Asian markets. New Delhi has been arguing that war-ravaged Afghanistan would be able to achieve its economic potential only if it is allowed freedom of transit to major markets in south Asia.
An agreement between Afghanistan and Pakistan on trade first signed in 2010, does not allow for Afghan trucks, that bring goods from Afghanistan to the Wagah border in Pakistan, to carry back products from India to Afghanistan. At Wagah, too, goods have to be unloaded from trucks coming from Afghanistan and reloaded again on other vehicles to be brought to Attari.
The trade and transit pact was revised earlier this year, but this too has no provisions for Indian goods to be taken to Pakistan.
The bilateral air corridor project is expected to underline the larger theme of connectivity among the Heart of Asia countries.
India’s choice of Amritsar as a venue also seems aimed at sending out a message to Pakistan which has been seen as the main deal breaker when it comes to integrating south Asia.
Pakistan, Afghanistan, Azerbaijan, China, India, Iran, Kazakhstan, Kyrgyzstan, Russia, Saudi Arabia, Tajikistan, Turkey, Turkmenistan and the United Arab Emirates are part of the Heart of Asia initiative launched in 2011 for encouraging economic and security cooperation between Afghanistan and its neighbours for dealing with the common problems of terrorism, extremism and poverty.
Organisers of the Heart of Asia-Istanbul Process, founded in Istanbul in November 2011, said the aim was to strengthen confidence-building measures and initiate steps to counter narcotics and terrorism and to expand trade, commerce and investment opportunities in Afghanistan.
Over 40 foreign ministers and dignitaries of the participating countries, including Russia, China, the United Arab Emirates and Iran, supporting countries like the US, Canada and France and international organisations like the European Union, will participate in the conference.
The last Heart of Asia Ministerial Conference was held in Islamabad in December 2015.