KARACHI - A plausible difference has been found in the transit trade agreements (TTA) between Pakistan and India with Afghanistan and Nepal which indicates the inefficiency of the Pakistani government to shield its sovereignty from future threats in economic prospects, The Nation has learnt. Indian transit trade agreement with Nepal shows that none of such fine details are present in Pakistan transit trade agreement with Afghanistan, as India prior to signing a transit trade agreement with Nepal insisted on signing a bilateral trade agreement, which was called India-Nepal foreign of treaty trade. Under the agreement it was restricted that only goods of Nepalese origin were allowed to be moved into India from Nepal for this such strict conditions were imposed. The goods must involve a manufacturing process in Nepal that brings about a change in classification, at four digit level, of the harmonized commodities description and coding system 70% of ex-factory price of the article produced and final process of manufacturing is performed within the territory of Nepal. All Nepalese goods entering into India must accompany a mutually agreed certificate of origin duly authenticated by Nepalese Government, and even this excludes certain items where Indian industry is threatened, fixed quota had been allocated which MFN status and duty relaxation was not applicable to Nepal. Although same conditions apply to Indian origin goods entering into Nepal, but being leading industrial state India has effectively achieved the objectives that Nepal become totally dependent on goods manufactured in India and any transit trade from a third country should only serve to fulfil any balance requirements. A second agreement related to transit trade which was called treaty of transit trade had been signed separately under which that in case of any Import from a third country other than India, a compulsory condition given in the agreement is that import will be allowed against import licenses issued by Government of Nepal and against letter of credit opened through a commercial bank. Both the bilateral trade and transit trade agreement then carries an Injury Clause which means significant damage to the domestic producers or like or similar products resulting from substantial increase in imports under the treaty in situation of which causes substantial losses in terms of earning, production or employment. A third agreement under the heading Control of Unauthorized Trade has also been signed, which restricts each country not to let re-export of goods imported or exported under Bilateral or Transit Trade. On the contrary, Pakistan signed a Transit Trade Agreement with Afghanistan and only significant clauses include that no distinction shall be made which is based on the flag of vessels, the place origin, departure, entry, exit or destination or any other circumstances relating to the ownership of goods, of vessels or of other means of transport. Under the 1965 agreement, there have been very few clauses which could compel Afghanistan to facilitate Pakistan manufactured goods as an equal trading partner to enter to its territory or transit to central Asian states. Nor it puts any binding on Afghanistan to take the responsibility of deflection of goods from its territory back into Pakistan The Karzai-led Afghan government has adopted discriminatory policies towards Pakistan. It resulted in reducing the Pakistani exports to Afghanistan from 1.67b to $600m last year. Afghan Government is charging high rate of tariff on Pakistani goods such as steel products, plastic goods, PVC goods, cement and citrus fruits etc. At the same time, goods imported from China and India via Pakistan are being charged with concessional rates of tariff, resulting in their illegal sales in Pakistan. Under the AnA, Kabul is bound to facilitate Pakistan transit trade with Central Asian Republics (CARs), but it has instead imposed a number of restrictions on Pakistanis trading with CARs via Afghanistan. The Afghan government has made it mandatory for Pakistani traders to get their trade contracts with their central Asian counterparts, registered with various Afghan ministries. A Pakistani trader has to pay $2000-3000 per contract and it takes more than 15 days to complete cumbersome formalities. Similarly, the Afghan government charges $300 from Pakistani traders per truck on transit consignments through Afghanistan from or to CARs. Moreover, an amount equivalent to 110 per cent Afghan custom duties has to be deposited with the Afghan customs at the time of entry of Pakistani transit goods into Afghanistan, to be refunded after deducting 20 per cent of the deposited amount and presentation of crossed border certificate. This practice takes too much time, as a Pakistani trader has to wait for 2-3 months to get his deposited amount refunded from the Afghan government. Pakistani traders suffer the Afghan Transit Trade (An) recorded 71.45pc growth at Rs 25.763b during first sixth month (July-Dec 2008). Imports of machinery and electronic items registered the highest growth of up to 192.31pc at Rs 4.027b against Rs 1.377b over last year. Similarly, there is tremendous growth of 39.99pc in import of iron and steel and other metal under ATT at Rs 746.56m from Rs 533.28m recorded in the same period last year. Imports of fabrics under ATT also increased by 28.90pc at Rs 5.143b during July-Dec period as against Rs 3.990b recorded in the same period last fiscal. Foodstuff imports under ATT increased by 32.21pc during first six months of current fiscal at Rs 6.227b compared to Rs 4.706b last year. During July-Dec period vehicles worth Rs 933.70m were imported compared to Rs433.12m earlier registering growth of 78.37pc. Other items are households goods, tiles, paper, chemical, plastic etc worth Rs 9.684b were imported during period under review as against Rs 3.985b during last fiscal year. The imports of cosmetics under the ATT for Afghanistan with the population of around 32m imported cosmetics worth Rs 117m in 2005-06 in the following year it recorded an increase 48pc to Rs 218m in 2007-08. The past agreements have resulted in massive smuggling of black tea, tyres, electronic goods, kitchen items, home appliances and other such goods into Pakistan. This happened despite the fact that Afghans prefer to drink green tea and not its black variety and the fact that the Afghan market was just not able to absorb the quantity of electronics and other goods booked in great volumes by the unscrupulous elements. The aggregate value of the international trade in Afghan opiates is approximately $ 40b. A rough estimate is Pakistan looses approximately USD 2 to 3b in tax revenue i.e. custom duties, GST & others, up against a total estimated volume of illegal transit trade which is approximately and estimated to be USD 10b, which has badly damaged its industry & trade.