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Cablegate: Afghan Official Reports Pakistan Seeks to Limit Goods

VZCZCXRO9354
OO RUEHDBU RUEHPW RUEHSL
DE RUEHBUL #0648 0530902
ZNR UUUUU ZZH
O 220902Z FEB 10
FM AMEMBASSY KABUL
TO RUEHC/SECSTATE WASHDC IMMEDIATE 5747
INFO RUEHIL/AMEMBASSY ISLAMABAD 8413
RUCNAFG/AFGHANISTAN COLLECTIVE

UNCLAS KABUL 000648

SENSITIVE
SIPDIS

DEPT FOR S/SRAP, SCA/FO, SCA/RA, AND SCA/A

E.O. 12958: N/A
TAGS: ETRD PREL AF PK
SUBJECT: AFGHAN OFFICIAL REPORTS PAKISTAN SEEKS TO LIMIT GOODS
DESTINED FOR AFGHANISTAN

1. (SBU) Afghan Ministry of Commerce and Industry (MOCI) Director of
International Trade told us February 20 that the Government of
Pakistan's Revenue Division has invoked a clause of its 1969 Customs
Act which allows it to restrict the transit of 22 categories of
goods destined to Afghanistan through Pakistan (see para 3 for
list). Our MOCI contact said the wide-ranging restrictions will
take effect on February 26 (fifteen days after the date of the
Pakistani letter), adding that Finance Minister Omar Zakhilwal is
preparing a sternly worded response to his Pakistani counterpart,
Minister of Finance Tareen. Embassy Kabul will forward Zakhilwal's
letter to the Department and Embassy Islamabad upon receipt.

2. (SBU) Comment: It is unclear what precipitated the Pakistani
letter. The majority of the goods mentioned on the list are those
Islamabad reportedly believes are exported to Afghanistan and
smuggled back into Pakistan. Afghan traders are very concerned that
the restrictions will affect their business. Business sector
representatives to the Afghanistan-Pakistan Transit Trade Agreement
(APTTA) who met earlier this month in Karachi told us they received
no indication from their Pakistani counterparts that such
restrictions were under consideration. If Islamabad indeed
implements this step on February 26, it will send a major negative
signal regarding the APTTA talks, not to mention adding a barrier to
trade when we have been urging more liberalization. End Comment.

3. (U) Text of Pakistani letter follows:

GOVERNMENT OF PAKISTAN
REVENUE DIVISION
FEDERAL BOARD OF REVENUE

Islamabad, the 11th February, 2010

NOTIFICATION (CUSTOMS)

S.R.O. (I)/2010.-In exercise of the powers conferred by sub-clause
(ii) of clause(s) of section 2 and sub-section (2) of section 156 of
the Customs Act, 1969 (IV of 1969), the Federal Government is
pleased to direct that the following further amendment shall be made
in its Notification No. S.R.O.566(I)/2005, dated the 6th of June,
2005, namely:-

In the aforesaid Notification, after S.No.32 and the entry relating
thereto, the following new serial numbers and the entries relating
thereto shall be added, namely:-

"33. Dyes and chemicals.
34. PVC and PMC materials.
35. Black tea (except Op-Pekoe).
36. Refrigerators.
37. Air Conditioners.
38. Television.
39. Soaps and shampoos.
40. Polyester metalized films.
41. Ball bearing.
42. Natural silk, natural silk yarn and natural silk fabrics.
43. Vegetable ghee and cooking oil
44. Telephone sets.
45. DVD and VCD players.
46. Microwave ovens.
47. Bicycles.
48. Hot rolled plates of high hardness ballistic protection.
49. Safety glass.
50. Wireless equipment of any kind.
51. BOP films.
52. Raw material for cigarette manufacturing industry (Filter Road,
Tipping Paper, Cigarette Paper and Acetate Tow).
53. Stainless steel sheets, circles and coils.
54. Tin plates and sheets."

/s/
(Munir Qureshi)
Additional Secretary

END QUOTE

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