Conflict, shortages push food prices up
Tuesday, 2 October 2007
Ashfaq Yusufzai from Peshawar
An acute shortage of food items in Afghanistan and Pakistan have sent prices shooting upwards in both countries.
But, while the food crisis in the war-torn country is a result of continuing conflict, north-western Pakistan has been suffering a shortage because of rampant smuggling of edible goods to Afghanistan.
"Re-building of war-ravaged Afghanistan besides affecting the prices of various non-food items has also had adverse effects on the commodity market of the bordering North Western Frontier Province (NWFP) because of massive smuggling," said Sharafat Ali Mubarak, a leading trader.
Everything from flour and rice to pulses and edible oil is taken illegally across the porous NWFP and adjoining Federally Administered Tribal Areas (FATA) borders, and sold across Afghanistan. According to traders, there has been a 100 percent hike in prices in Pakistan because of unhindered smuggling.
"The people who bought 20 kg of wheat flour at five US dollars one year ago are now getting the same thing at 10 dollars. The situation in Afghanistan is very bad. The same bag of flour is sold for 15 dollars," said Mubarak.
Gul Ahmad, an Afghan trader in Peshawar, told IPS that smuggling was very lucrative. "It's very tough," he added. "The routes are not good. We pay huge amounts to the customs officials on both sides of the border."
Ahmad who called Peshawar his second home said: "I frequently visit Peshawar and take back food items to Kabul to make more profit."
According to the exporters, most of the country's export via land routes is taking place through official customs posts at Chaman, Torkham and Ghulam Khan, but there are also a number of traditional routes through which goods are smuggled from both the countries.
Even fruits, which used to be imported by Pakistan from Afghanistan till 1990, are now brought in clandestinely from Pakistan. "The price of grapes, pomegranates, oranges, mangoes, apples and bananas besides all kinds of vegetables has increased because of smuggling," said a vegetable dealer.
According to Naeem Butt, president of the NWFP Flour Association, the considerable increase in the flow of edibles to Afghanistan from NWFP during last couple of years has widened the demand and supply gap subsequently pushing up the prices at the local level.
Official data shows that in 2005-06, the overall volume of exports to Afghanistan was 1,063.463 million dollars, out of which the value of edibles was 397.393 million dollars.
In 2004-05, the volume of commodity export was 291.699 million dollars, but Butt said that worth of smuggled items was far more than the official trade with the landlocked country.
"This is the tip of the iceberg. The quantum of smuggled edible items to Afghanistan is four times higher than this," asserted Liaqat Ahmad Khan, president of the NWFP Chamber of Commerce and Industries (NCCI).
Satar Muhammad, president of the Food Grain Dealers Association said the price of rice (in NWFP) has shot up mainly because of growing smuggling to Afghanistan.
Officially, Pakistan has a bilateral trade of 2 billion dollars with Afghanistan. But the volume of clandestine business between the two countries is estimated to be more than ten billion dollars every year.
Authorities in both Pakistan and Afghanistan profit from the huge bribes paid out to ensure the illegal trade continues without interruption.
Numan Wazir, president of the Industrialists Association in Peshawar, said trade and industry in the NWFP is mostly focused on the consumer markets in Afghanistan, but the government's inability to give incentives is cramping business.
Flour is being smuggled to Afghanistan by NWFP traders. Afghanistan has emerged as an ideal destination for the flour industry, which is in a severe crisis for the last few years owing to a variety of reasons. Most of the 350 flourmill owners prefer to smuggle the commodity to Afghanistan.
Multan Khan, a resident of Leghman province in Afghanistan, said that he has been in the poultry business for 10 years. "There is no loss," he boasted. "We purchase 1 kg of chicken at 2 dollars in Pakistan and sell it for 4 dollars in Afghanistan," he said.
The people most affected by the rampant illegal trade to Afghanistan are those living in the border areas of NWFP, FATA and Balochistan.
"I had not seen a price hike of tomatoes till 1990. But the people not only have to pay more for tomatoes but at times are faced with shortages," said Mian Khan.
..............................
Inter Press Service
An acute shortage of food items in Afghanistan and Pakistan have sent prices shooting upwards in both countries.
But, while the food crisis in the war-torn country is a result of continuing conflict, north-western Pakistan has been suffering a shortage because of rampant smuggling of edible goods to Afghanistan.
"Re-building of war-ravaged Afghanistan besides affecting the prices of various non-food items has also had adverse effects on the commodity market of the bordering North Western Frontier Province (NWFP) because of massive smuggling," said Sharafat Ali Mubarak, a leading trader.
Everything from flour and rice to pulses and edible oil is taken illegally across the porous NWFP and adjoining Federally Administered Tribal Areas (FATA) borders, and sold across Afghanistan. According to traders, there has been a 100 percent hike in prices in Pakistan because of unhindered smuggling.
"The people who bought 20 kg of wheat flour at five US dollars one year ago are now getting the same thing at 10 dollars. The situation in Afghanistan is very bad. The same bag of flour is sold for 15 dollars," said Mubarak.
Gul Ahmad, an Afghan trader in Peshawar, told IPS that smuggling was very lucrative. "It's very tough," he added. "The routes are not good. We pay huge amounts to the customs officials on both sides of the border."
Ahmad who called Peshawar his second home said: "I frequently visit Peshawar and take back food items to Kabul to make more profit."
According to the exporters, most of the country's export via land routes is taking place through official customs posts at Chaman, Torkham and Ghulam Khan, but there are also a number of traditional routes through which goods are smuggled from both the countries.
Even fruits, which used to be imported by Pakistan from Afghanistan till 1990, are now brought in clandestinely from Pakistan. "The price of grapes, pomegranates, oranges, mangoes, apples and bananas besides all kinds of vegetables has increased because of smuggling," said a vegetable dealer.
According to Naeem Butt, president of the NWFP Flour Association, the considerable increase in the flow of edibles to Afghanistan from NWFP during last couple of years has widened the demand and supply gap subsequently pushing up the prices at the local level.
Official data shows that in 2005-06, the overall volume of exports to Afghanistan was 1,063.463 million dollars, out of which the value of edibles was 397.393 million dollars.
In 2004-05, the volume of commodity export was 291.699 million dollars, but Butt said that worth of smuggled items was far more than the official trade with the landlocked country.
"This is the tip of the iceberg. The quantum of smuggled edible items to Afghanistan is four times higher than this," asserted Liaqat Ahmad Khan, president of the NWFP Chamber of Commerce and Industries (NCCI).
Satar Muhammad, president of the Food Grain Dealers Association said the price of rice (in NWFP) has shot up mainly because of growing smuggling to Afghanistan.
Officially, Pakistan has a bilateral trade of 2 billion dollars with Afghanistan. But the volume of clandestine business between the two countries is estimated to be more than ten billion dollars every year.
Authorities in both Pakistan and Afghanistan profit from the huge bribes paid out to ensure the illegal trade continues without interruption.
Numan Wazir, president of the Industrialists Association in Peshawar, said trade and industry in the NWFP is mostly focused on the consumer markets in Afghanistan, but the government's inability to give incentives is cramping business.
Flour is being smuggled to Afghanistan by NWFP traders. Afghanistan has emerged as an ideal destination for the flour industry, which is in a severe crisis for the last few years owing to a variety of reasons. Most of the 350 flourmill owners prefer to smuggle the commodity to Afghanistan.
Multan Khan, a resident of Leghman province in Afghanistan, said that he has been in the poultry business for 10 years. "There is no loss," he boasted. "We purchase 1 kg of chicken at 2 dollars in Pakistan and sell it for 4 dollars in Afghanistan," he said.
The people most affected by the rampant illegal trade to Afghanistan are those living in the border areas of NWFP, FATA and Balochistan.
"I had not seen a price hike of tomatoes till 1990. But the people not only have to pay more for tomatoes but at times are faced with shortages," said Mian Khan.
..............................
Inter Press Service