That more than covers the USD 17 million that Afghanistan’s central bank injects into the market each week….reports Asian Lite News
Millions of dollars are being smuggled into Afghanistan from Pakistan each day. This helps in providing support to the economy after the US and Europe denied the Taliban access to billions in foreign reserves, according to a report in Pakistan based The Express Tribune newspaper.
According to foreign media, for Islamabad, the outflows are worsening a rapidly developing economic crisis in the country. According to general secretary of the Exchange Companies Association of Pakistan Muhammad Zafar Paracha, traders, and smugglers are bringing as much as USD 5 million across the border daily.
That more than covers the USD 17 million that Afghanistan’s central bank injects into the market each week. The illicit flows show how the Taliban are evading sanctions after their 2021 takeover of the country, according to The Express Tribune newspaper.
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The smuggling is contributing to the depletion of Pakistan’s foreign reserves and adding to the downward pressure on the rupee as the currency tumbles to record lows. “Currency is being smuggled without any doubt. This has become quite a lucrative business,” Paracha said.
US-based The Diplomat magazine recently reported that money exchangers on both sides of the Durand Line have bolstered the Afghanistan-Pakistan US dollar cartel by manipulating trade, both actual and forged.
The Diplomat said the black market is dominated by the flow of US dollars across the Afghanistan-Pakistan border, which unifies the economic crises of the two countries.
Currency notes are often found hidden in vegetable trucks with perishable goods passing through the Green Channel. These trucks dodge customs scanners. US currency is smuggled via food items ranging from orange crates to beetle nut sachets, claimed the report.
Those involved in dollar smuggling have used the hawala system to monopolise currency in the region, the report said, adding that through the hawala system, money is transferred without any physical movement of cash or documentation.
The system helps sustain a parallel economy without any government regulations, in turn maintaining ground for illegal monopolization by cartels.
In interviews with The Diplomat, money exchangers in both Afghanistan and Pakistan insisted that the dollar cartel isn’t a monolith, and sustains itself with cooperation between sections of the traders and currency markets. A consistent exchange rate is used for systematic hawala transactions, with anyone involved in the currency trading business along the Af-Pak border being a participant, active or passive, according to the report.
“We deserve the cut that we get in all this since the market forces determining the interbank exchange rate do not factor in the violent forces enforcing their own regulations,” an exchanger from Kabul’s Sarai Shahzadeh market, one of the hubs for the dollar cartel’s dealing, told The Diplomat. (ANI)
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