The other trade war: What Afghanistan’s tensions with Islamabad have meant for its trade with Pakistan, India

The intricate web of trade relations between Afghanistan, Pakistan, and India is a critical aspect of South Asian geopolitics, deeply influenced by historical animosities, strategic interests, and the challenging geography of the region. Afghanistan, being landlocked, has historically relied heavily on Pakistan for transit trade to access global markets. However, this dependence has frequently been a source of tension, impacting Afghanistan's economic stability and its ability to foster independent trade relationships, particularly with India.

The background context for these tensions is rooted in the partition of British India in 1947 and the contentious Durand Line, which demarcates the Afghanistan-Pakistan border. Afghanistan has historically disputed this border, fueling a perpetual sense of mistrust with Pakistan. This geopolitical friction intensified with the rise of the Taliban in Afghanistan, a group often perceived to have historical linkages with elements within Pakistan. Pakistan's strategic depth doctrine and its concerns over Indian influence in Afghanistan have further complicated transit trade dynamics.

What typically happens during periods of tension is that Pakistan imposes restrictions on Afghan transit trade, citing security concerns or border management issues. This can range from delays at border crossings like Torkham and Chaman to outright bans on certain goods or routes. Such actions severely impact Afghanistan's economy, as it struggles to export its agricultural products (like dried fruits, nuts, and fresh produce) and carpets, and import essential goods. These restrictions are often seen as a tool of leverage by Pakistan against Afghanistan, regardless of the government in Kabul. For India, this means its direct trade with Afghanistan, which would ideally pass through Pakistan, is hampered, forcing it to seek alternative, often more expensive and circuitous, routes.

Key stakeholders involved in this complex scenario are primarily Afghanistan, Pakistan, and India. Afghanistan, currently under Taliban rule, desperately seeks economic stability and international recognition. Its primary goal is to secure unhindered access to seaports for its trade, reducing its vulnerability to Pakistani leverage. Pakistan, on the other hand, views its transit route as a strategic asset, crucial for its own economic stability (through transit fees) and its regional influence. It is also deeply concerned about cross-border terrorism and managing the flow of people and goods across the Durand Line. India is a significant economic and strategic partner for Afghanistan, having invested heavily in infrastructure projects, including the Afghan Parliament, Salma Dam (India-Afghanistan Friendship Dam), and Zaranj-Delaram Highway. India's interest lies in regional connectivity, access to Central Asian markets, and fostering a stable, friendly Afghanistan to counter regional extremist elements and promote its 'Connect Central Asia' policy.

This situation matters immensely for India for several reasons. Economically, Afghanistan represents a gateway to the resource-rich Central Asian Republics, an important component of India's broader trade and energy security strategy. Hampered transit trade through Pakistan forces India to rely on alternative routes like the International North-South Transport Corridor (INSTC) and the Chabahar Port in Iran. While these routes offer strategic alternatives, they are often costlier and logistically more challenging. Politically and strategically, a stable and economically viable Afghanistan is crucial for India's regional security. An unstable Afghanistan, particularly one dominated by groups hostile to India, poses significant security threats, including the potential for cross-border terrorism. India's soft power projection and its role as a regional development partner are also at stake.

Historically, India and Afghanistan have shared strong cultural and economic ties, predating the modern nation-states. India has consistently supported Afghanistan's development and democratic processes (prior to the Taliban takeover in August 2021). The current tensions reflect a continuation of the geopolitical chess game in the region, exacerbated by the recent political changes in Afghanistan. India's efforts to develop the Chabahar Port, operationalized in part in 2018, specifically aimed to bypass Pakistan and provide Afghanistan with an alternative maritime trade route, demonstrating India's proactive strategy to mitigate the impact of Pakistan's transit policies.

Looking to the future, the implications are profound. Continued tensions could further isolate Afghanistan economically, potentially exacerbating humanitarian crises and regional instability. For India, it means redoubling efforts on alternative connectivity projects like INSTC and Chabahar. The long-term success of these routes is vital for India's economic ambitions in Central Asia. It also necessitates a nuanced diplomatic approach to the Taliban regime, balancing humanitarian concerns with security imperatives and regional strategic interests. The China-Pakistan Economic Corridor (CPEC) also adds another layer, potentially drawing Afghanistan into its orbit and further complicating India's regional connectivity efforts.

While direct constitutional articles governing international trade disputes are less about specific articles and more about the executive's power, Article 73 of the Indian Constitution grants the executive power to enter into international agreements and treaties, read with Article 253, which empowers Parliament to make laws for implementing international treaties. India's Foreign Trade Policy, updated periodically, outlines the framework for its international trade, including strategies for market access and diversification. The 'Connect Central Asia' policy and the 'Act East Policy' (though geographically distinct, conceptually similar in seeking connectivity) are key policy initiatives guiding India's strategic outreach in the broader Eurasian region, demonstrating the government's commitment to overcoming geographical barriers and political hurdles for trade and strategic partnerships.