How to Exports from Pakistan to Afghanistan

Guidance For Export To Afghanistan

The trade volume between Pakistan and Afghanistan is about $2 billion its official statistic while the unofficial trade volume is about $5 billion so, it would safe to say that Afghanistan is the second largest importer of Pakistani goods after United States.

In this article we are reproducing some points from Export Policy Order 2013 related to Export to Afghanistan

Exports to Afghanistan and through Afghanistan to Central Asian Republics.-

(1) In Pak Rupees. - Subject to provisions of sub-paragraph (1) of paragraph 4, export of all commodities produced or manufactured in Pakistan, excluding those manufactured in manufacturing bonds and export oriented units, shall be allowed via land route, against Pak-rupee on filing of regular shipping bills without ‘E’ Form. Such exports shall not be entitled to,

(i) zero-rating of sales tax on taxable goods;
(ii) rebate of central excise duty; and
(iii) repayment or drawback of customs-duty.

(2) In Convertible Currency.- Subject to the provisions of sub-paragraph (1) of paragraph 4 and Schedule III, all items and commodities produced or manufactured in Pakistan, exported via land route or by air against irrevocable letters of credit, confirmed orders on realization of export proceeds through banking channel or advance payment, in convertible foreign currency, shall be allowed.-

(a) zero-rating of sales tax on taxable goods;
(b) rebate of central excise duty; and
(c) repayment or drawback of customs-duty, subject to the conditions namely
following the proviso below,

Provided that the above facility of duty and tax-exemption including refund of petroleum levy shall not be available to the export of petroleum products unless there is a Government to Government contract and export is done only through Oil Marketing Companies (OMCs) duly registered with the Oil and Gas Regulatory Authority (OGRA). Surplus of JP-8, as declared and decided in the product review
meetings, shall also be allowed to be exported by the refineries or OMCs. If any of the OMC is of the intention to import and then export JP-8 to Afghanistan that specific

volumes shall be allowed through foreign exchange remittance from the buyers without availing any exemption of duties and taxes,

(i) the proof that goods exported from Pakistan have reached Afghanistan shall be verified on the basis of copy of import clearance documents by Afghan Customs Authorities across the border:

Provided that this condition shall not apply to exports made to International Security Assistance Force (ISAF) and Defence Logistic Support Center (DLSC) in Afghanistan. To claim the facility of zero rating of sales tax or duty drawbacks as well as federal excise duty refund against goods exported to ISAF and DLSC, the customs authorities shall allow refunds on the basis of receipts issued by the Afghan offices of these agencies confirming that they have received the goods. The receipt shall be reconfirmed by the
representatives of these agencies in Pakistan;

(ii) packages or retail packing shall be prominently and indelibly be marked with the expression “For Export Only”, and in case of international donor agencies “For Export only – supply for aid to Afghanistan (insignia of the organization) – not for sale in Pakistan”;

(iii) export shall be allowed only through authorized export land routes i.e. Torkham, Chaman, Ghulam Khan (for export of cement only) and Qamar Uddin Karez (when it becomes operational);

(iv) export from Export Processing Zones, manufacturing bonds and export oriented units, except vegetable ghee and cooking oil, shall be allowed but these exports shall not be entitled to-

(i) zero-rating of sales tax on taxable goods;
(ii) rebate of federal excise duty; and
(iii) repayment or drawback of customs-duty:

Provided that export made to International Security Assistance Force (ISAF) and Defence Energy Support Center (DESC) may be made on deferred payment basis, without opening of Letter of Credit,
subject to the following conditions, namely:-

(a) the waiver shall be applicable strictly to exports made to ISAF and DESC;
(b) shipments to ISAF and DESC are made by their authorized agents duly endorsed by the ISAF and DESC receiving agent in Afghanistan; and
( C) payment of foreign exchange is received within sixty days of shipmen; and

(v) zero rating of sales tax or duty drawbacks as well as federal excise duty refund against goods exported to ISAF and Defence Logistics Agency(DLA), may be allowed on production of receipts issued by ISAF and DLA confirming that they have received the goods. The receipts shall be reconfirmed by the representatives of these agencies located in Pakistan.

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