Iran Ranks First Among Exporters to Afghanistan

EghtesadOnline: Iran has exported $1.24 billion worth of commodities to Afghanistan since the beginning of the current Iranian year (March 21, 2019) to top the list of world exporters to the neighboring country.

News ID: ۷۸۵۴۱۷

29 February 2020

Hasibullo Movahed, an official with the Central Statistical Organization of Afghanistan, added that Afghanistan mainly imports oil products, machinery, edible oil, textile products, metal products and electricity, Mehr News Agency reported.

This is while Iran mainly exports low-density oils, iron/steel bars and floorings to Afghanistan, according to Financial Tribune.

“Afghanistan has imported $8.3 billion worth of goods in the current Iranian year, witnessing an over 8% decline compared with last year’s corresponding period,” Movahed said.

Highlighting that trade with Afghanistan is of high value to Tehran, Iran’s Ambassador in Kabul Bahador Aminian said, “Afghanistan has for long been a major destination for Iranian products. In fact, Iran's exports to Afghanistan are three times more than overall exports to 28 member states of the European Union.”

Addressing the Working Group for Export Development and Council for Organizing Border Exchanges of South Khorasan Province a few months ago, Aminian said developing trade ties with Afghanistan is Iran’s priority because the two countries are neighbors.

“Afghanistan is Iran’s priority in our resistance economy policies, as it is our neighbor and has a good share of our exported products,” he added.

Aminian called on Iran’s private sector to play a more prominent role in exports to the country’s eastern neighbor.

He noted that Iran is active in establishing universities and vocational schools in Afghanistan and forging bilateral ties in agriculture and health tourism sectors.

The Iranian envoy stressed that Iranian businessmen should establish joint ventures in Afghanistan’s industrial estates to be able to later export to other countries, including Europe.

South Khorasan’s Deputy Governor for Coordination of Economic Affairs Moshirolhaq Abedi urged better and faster connection between the Iranian and Afghan provinces, including Farah.

South Khorasan shares 331 kilometers of land border with Afghanistan, according to the official.

Main Energy Supplier

Iran is the main energy supplier of Afghanistan, providing the neighboring country with electricity, oil, oil products and gas.

Due to Kabul’s heavy dependence on energy supplies from Iran, the US is unable to affect cross-border interactions and trade between the two countries.

According to Dogharoun Customs Office’s Director General Mohammad Kuh-Gerda, Iran’s export of liquefied natural gas to Afghanistan from the border crossing of Dogharoun has quadrupled in the first five months of the current fiscal year (started March 21, 2019).

“Iran exported 44,929 tons of LNG to Afghanistan during the same period of last year,” he added.

Ten trucks load Iran’s LNG at Doqaroon Customs Office on a daily basis and head for Afghanistan, according to the official.

Eighty percent of the exported energy are made up of raffinate and liquefied petroleum gas (LPG).

All of Iran’s energy exports to Herat in Afghanistan are made through Dogharoun Customs Office.

More than 145,000 tons of LNG were loaded onto trucks and dispatched to Afghanistan from Dogharoun Customs Office in the last Iranian year (ended March 20, 2019).

“Dogharoun Customs Office’s capacity is 350,000 tons of LNG exports, that’s why we have installed the most modern facilities there,” Kuh-Gerda has been quoted as saying.

Impact of Trade Restrictions on Afghan Market

The head of Iran-Afghanistan Chamber of Commerce recently said Turkey was beginning to overtake Iran in commercial exchanges with Afghanistan due to economic restrictions self-imposed by the Islamic Republic in the face of US sanctions.

Noting that trade is a two-way business, Hossein Salimi elaborated that since Iran’s Agriculture Ministry has banned imports of some crops to support domestic producers, Iran-Afghanistan trade has been adversely affected.

He said Afghans also want to export agro products to Iran but have failed to do so due to Iranian restrictions, Fars News Agency reported.

The list of Iran's banned imports has become longer, as the government unfolded its latest foreign trade decision that adds 120 goods to the previous list of 1,530 recently.

The decision was taken by the heads of the three branches of power in a meeting of the Supreme Council of Economic Coordination in response to a call by Leader of Islamic Revolution Ayatollah Seyyed Ali Khamenei.

Last year (March 2018-19), the government banned the import of 1,339 items categorized as “Group Four” products that are “non-essential” and have “counterparts made at home”, in a move to save foreign currency.

The Ministry Of Industries, Mining and Trade has been tasked with identifying imports that are either unnecessary or those which local enterprises have the capability to produce, Deputy Industries Minister Hossein Modarres Khiyabani told Tasnim News Agency.

“The time is ripe for the manufacturing sector of the country to leap forward both in terms of quantity and quality, as resorting to imports is not justifiable due to the high exchange rate of the foreign currencies,” he added.

With the new decision, Khiyabani added, different industrial subsectors will have double potential to increase their production capacity and rid themselves of dependency.

“Imports will now be restricted to two groups of commodities: essential goods that are directly related to people’s food basket, in addition to raw materials, machinery parts and equipment needed by manufacturing enterprises,” he said.

“To promote commercial exchanges, there must be bilateral interactions; this is while we are only seeking to export and this has limited business opportunities for us. Our absence in foreign markets has provided other countries, including Turkey, with export opportunities,” Salimi said.

Afghanistan mainly exports agro products such as walnut and pomegranate to countries like China, Turkey and Canada, but Iran has banned the import of these crops.

Border Reopens After Initial Closure Over Coronavirus

Afghanistan reopened its border with Iran, a day after closing it over coronavirus fears, Afghanistan's National Security Council said on Tuesday.

In a statement, NSC said a committee formed to prevent coronavirus had decided that control measures should be put in place on Afghanistan-Iran border to allow passenger movement, Afghanistan's television channel TV1 reported.

It also said passengers coming from coronavirus hotspots and who are subject to quarantine should immediately be quarantined.

"To prevent the spread of the novel #coronavirus and protect the public, Afghanistan suspends all passenger movement (air and ground) to and from Iran," the office of the National Security Council of Afghanistan tweeted earlier.

Afghanistan shares a long, porous border with Iran, which is often used by smugglers and human traffickers, while millions of Afghan refugees live in the Islamic Republic, raising fears that the virus could easily spread over the border.