Trade between Pakistan and Afghanistan has suffered a massive blow, with official data revealing a drastic year-on-year contraction of more than half. The closure of key border crossings has severely disrupted economic exchange between the two neighboring nations.
Sharp Decline in Trade Figures
According to an official source, the total volume of bilateral goods trade plummeted by 53 percent during the first half of the current fiscal year. The trade fell from $1.26 billion in the July-December period of FY2024-25 to just $594 million in the same period of FY2025-26.
The breakdown shows Pakistan's exports to Afghanistan were hit particularly hard, dropping by 55 percent. Exports declined from $754 million last year to $336 million in the first six months of the ongoing fiscal year.
Imports Also Take a Major Hit
The downturn was not one-sided. Pakistan's imports from Afghanistan also recorded a significant fall of 49 percent on a year-on-year basis. Imports reduced to $258 million during July-December FY2025-26, down from $507 million in the corresponding period of the previous fiscal year.
This synchronized decline in both export and import flows points to a severe disruption in the established trade corridors and supply chains linking the two economies.
Border Closures: The Primary Cause
The primary driver behind this sharp contraction was the complete closure of border crossing points. Following clashes on October 11, Pakistan shut down all eight border crossings with Afghanistan.
This decision had immediate and severe consequences:
- Thousands of traders were stranded on both sides.
- Goods worth millions of dollars were stuck, unable to move.
- By December, official estimates pointed to losses amounting to hundreds of millions of dollars.
The source indicated that the overall decline reflects reduced cross-border demand and major disruptions in trade flows, leading to a much narrower trade volume during the review period. The data underscores the profound economic interdependence between Pakistan and Afghanistan and the costly impact of political and security decisions on bilateral commerce.
