Islamic Republic of Afghanistan
Ministry of Commerce and Industries
Transit Points and Dry Ports in
Afghanistan
Issues and Recommendations
Sayed Yahya Akhlaqi
Director of Transit and Trade Facilitation Department
1
1
Objectives
2
Transit Points and Routes
3
Performance Measurement
4
Issues
5
Recommendations
2
#1
Discuss the current efficiency
of cross-border trade.
#2
Analyze the current situation
and issues of Dry Ports in
Afghanistan.
#3
Suggest improvements to Dry
Ports.
3
1
Introduction
2
Transit Points and Routes
3
Performance Measurement
4
Issues
5
Recommendations
4
Central Asia
Land-locked region
Energy-Rich
Complicated Border Crossing
East Asia
Economically Vibrant
Huge Demand for
Energy and Resources
Large Demographics
Middle East
Energy-Surplus Region
Capital Surplus
U.A.E. just acceded to TIR
South Asia
Favourable Demographics
Access to seaports
5
6
CAREC Corridor 5
(Cross Border Transport Agreement, CBTA)
7
Caspian-Black Sea transit corridor
2500-2800 km Long,12 Days Time
Survey by Transit Trade Facilitation Dept of MoCI, 2015
8
Map of the Corridor
Kazakhstan
Shevchenko
Aktau
Kulevi
Poti
Batumi
Dubendi
Kars
LEGEND:
Ports
Oil Terminals
Railways
Sea Routes
Turkmenbashi
Sangachal AIOC
Cheleken
Sangachal
Uzbekistan
Afghan Imports via Transit Nations (2009 to 2013)
Transit Nations
2009
2010
2011
2012
2013
Transit Via Iran
514
1,378
2,621
1,929
1,562
Transit Via Pakistan
287
912
1,165
758
1,192
Transit via Uzbekistan
679
680
849
860
1,112
Transit via Tajikistan
5
46
93
26
97
Transit via Turkmenistan
106
152
215
138
242
Units in USD, Millions
Source : Afghanistan Customs Department
10
Afghan Imports via Transit Nations (2009 to 2013)
3,000
Value, USD in Millions
2,500
2,000
1,500
1,000
500
0
2009
Transit Via Iran
2010
Transit Via Pakistan
2011
2012
Transit via Uzbekistan
Transit via Tajikistan
2013
Transit via Turkmenistan
11
12
Afghanistan location is strategic in connecting
South and Central Asia.
The country needs to diversify from over-reliance
on Pakistan as a source and sea-ports to
alternative routes.
International agreements and standards are
important.
Border Crossing needs to be improved.
13
1
Introduction
2
Transit Points and Routes
3
Performance Measurement
4
Issues
5
Recommendations
14
Key Performance Indicators :
To measure efficiency of dry ports, three metrics are used.
• Number of Documents
• Time
• Cost
These metrics are also analysed for import and export.
World Bank has two comprehensive studies to measure such
efficiency.
They are called :
• Doing Business
• Logistics Performance Indicators
15
Indicator
Documents to
export (number)
Time to export
(days)
Cost to export
(US$ per container)
Documents to
import (number)
Time to import
(days)
Cost to import
(US$ per container)
Afghanistan
South Asia
OECD
10
8
4
2
33.4
10.5
3,000.0
1,922.9
1,080.3
10
9
4
30.0
34.4
9.6
3500.0
2,117.8
1,100.4
Source : http://www.doingbusiness.org/data/exploreeconomies/afghanistan#trading-across-borders
16
Nature of Export
Procedures
Duration (days)
US$ Cost
44
570
Customs clearance and
inspections
8
300
Ports and terminal
handling
4
175
Inland transportation
and handling
30
4,000
Totals
86
5,045
Documents
preparation
Source : http://www.doingbusiness.org/data/exploreeconomies/afghanistan#trading-across-borders
17
Nature of Import
Procedures
Duration (days)
US$ Cost
49
680
Customs clearance
and inspections
7
300
Ports and terminal
handling
5
200
Inland transportation
and handling
30
4,500
Totals
91
5,680
Documents
preparation
Source : http://www.doingbusiness.org/data/exploreeconomies/afghanistan#trading-across-borders
18
Afghanistan
Pakistan
Tajikistan
Turkmenistan
Uzbekistan
Customs
3.5
3
2.5
Timeliness
2
Infrastructure
1.5
1
0.5
0
International
Tracking & tracing
shipments
Logistics competence
Source : http://lpi.worldbank.org/international/global
19






Afghanistan suffers from high cost of trading, and
long overall time to import and export, compared to
neighbor countries.
Both time and cost is 2.5 times higher than the
average in South Asia.
The main problem for long time is due to
documentation.
The main problem for high cost is due to inland
transport.
Based on Logistics Performance 2014 study,
infrastructure is the main shortcoming in Afghanistan.
It justifies the important discussion today on
improving dry port infrastructure, design and
operations.
20
1
Introduction
2
Transit Points and Routes
3
Performance Measurement
4
Issues
5
Recommendations
21
Too Much
Paperwork?
Poor Logistics?
Poor Facility?
No Regional
Cooperation?
Poor Cargo
Handling?
Unofficial
Payments?
22
Case Study : Shirkhan Bandar
Dry Port ‘Shirkhan
Bandar’.
According
to ADB studies, the
border crossing time
is quite long at 10
hours per truck.
Crane in operation?
Warehouses
23
Free Economic Zone Planned at Nizhni Panj
24
Case Study : Hairatan
Many Afghan exports
(especially fruits and
vegetables) go across
Hairatan.
However the border
crossing is done by
barges operated by
Uzbeks.
During winter when the
barges do not arrive on
time, the products may
be easily damaged, due
to the lack of temporary
storage.
25
1
Introduction
2
Transit Points and Routes
3
Performance Measurement
4
Issues
5
Recommendations
26
Institution
What laws and decrees need to be created?
What laws need to be changed?
How can regulation help, not impede Dry Ports?
How can MOCI improve implementation and enforcement?
Infrastructure
Are the Dry Ports built with the right design and size?
Do they have the right equipment and facilities?
Do they have good access roads?
Can they connect to roads and railways?
Investment
What kind of investment can improve dry ports?
Who are the investors?
Can Public Private Partnership (PPP) work”?
What is the estimated sum?
Can ADB, EU, EBRD or Islamic Development Bank help?
27
Points for Discussion
• PPP law
• New International Conventions
• Simplify Visa for Drivers
• Simplify Road Pass for Trucks
• Simplify Land Ownership, Transfer and
Acquisition Laws
28
In India, there are many Dry Ports known as Inland Container Depot (ICD).
For example, containers arrive in Mumbai and truck to ICD outside Delhi.
In the ICD, transport operators can consolidate and break bulk.
One serious problem is land ownership rules are not clear, which impede
the Federal Government’s ability to acquire land. Land Acquisition has to
be developed to empower Government to acquire land for developing dry
ports. One important aspect is how to valuate land.
Such laws are important so that investors can be attracted in PPP.
29
Points for Discussion
• Access Roads
• Extend Railways into Dry Port at Mashare
Sharif?
• Warehouses, Refrigerated Storage
• Road-Side Services (e.g. Petrol Stations,
Cafes, Motels for Drivers)
• Trucking Terminal, Car Parks
• Express Lanes/Green Lanes
30
In Kyrgyz Republic, the
country sets up ‘express
lanes’ at border crossing
points.
This allows special trucks to
cross the border faster
through shorter queue and
less paperwork.
Afghanistan can consider to include this feature for TIR trucks. These
trucks should be able to cross the Dry Port faster since they satisfy the
stringent criteria under TIR.
31
Points for Discussion
• What kind of investors should we target?
• Can we utilize international donor
organizations?
• What kinds of concessions should we give?
• What kind of outcomes do we want?
(investment dollars, employment,
technology transfer)
32
PRC welcomes investor-operator to setup
logistics parks, factories and whole sale
centres in Class I Dry Ports (located at
international border).
To attract investors, many incentives are
designed and given.
1. Tax Holiday on land rentals
2. Waive of import duties for importing of machineries and equipment
3. Using electronic logistics information system to expedite customs
clearance and simplify paper work
4. Establish a joint border cooperation centre with Kazakhstan (total
about 5 hectares). Citizens from both countries can enter and procure
items without paying taxes.
33
E-mail: Yahyaakhlaqee@gmail.com
34