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Buoyed by its unprecedented victory in the latest global Doing Business ranks, Afghanistan has called to open a direct air corridor with Sri Lanka on 25 March. Kabul is also keen on an Investment Protection and Promotion (IPP) pact with Colombo to revive lagging bilateral economic ties.
“The Government of Afghanistan launched the air corridor two years ago to take domestic goods to countries in the neighbourhood and beyond the region. As a result in 2018 we exported over $ 1 billion products. We would like to extend this corridor to Sri Lanka, via a new corridor through the south, all the way to Colombo,” said Afghanistan’s Ambassador to Sri Lanka M. Ashraf Haidari on 15 March. Ambassador Haidari was addressing Sri Lanka Minister of Industry Commerce, Resettlement of Protracted Displaced Persons and Cooperative Development Rishad Bathiudeen during his courtesy call at the Ministry in Colombo 3. Ambassador Haidari was joined by First Secretary, Munir Ghiasy. “This proposed corridor is not coming via any other country but a direct air-link to Colombo. However, since there is no direct Kabul-Colombo connectivity at this moment, at the beginning, and only at the beginning, we may have to come through Mumbai or Delhi, but thereafter it will be a direct connection to Colombo. We encourage SriLankan Airlines too to consider a direct flight to Afghanistan. As far as an air service agreement is considered, we are ready to extend special lower tariff, landing rights depending on value, exemptions to Lankan businesses, easy business registration for Lankan businesses coming there as well as Afghani cargo coming to Colombo – even easy visas to Lankan travellers coming there. Kabul based airlines such as Ariana Afghan Airlines and Kam Air are ready to come to Colombo. We need to exchange business delegations between both countries, as a start. We are proposing an Investment Protection and Promotion Agreement to kickstart bilateral investment and trade. We are also proposing an Afghanistan-Sri Lanka Business Council, which will facilitate these bilateral B2B prcoesses at business level – since ground level businesses know which products move both ways. The bilateral trade need not be limited to Air Corridor only but if necessary can be conducted through marine cargo as well-depending on product-wise cost effectiveness,” Ambassador Haidari said.
“We look forward to see Minister Bathiudeen signing the Investment Protection and Promotion Agreement representing Sri Lanka side. We already have such pacts with India, Iran, Pakistan and some other countries in the region. As for air-corridors we already have such with India, Central Asia, and China. Even Turkey and Finland are interested. It is time Sri Lanka joins us. By the way the air-corridor we propose towards Colombo is not an extension of our corridor with India but a dedicated link to Colombo,” he added.
In its Doing Business 2019 report, the World Bank said Afghanistan to be one of the top 10 improvers in doing business alongside China, and India. Afghanistan climbed 16 positions in rankings from previous 2018 Report, to a new rank of 167.
Responding to Ambassador Hairdari, Minister Bathiudeen said that he is pleased that his initial discussions in Colombo in August 2018 with First Secretary Munir Ghiasy is finally bearing fruit. “From Sri Lankan exporters’ point of view, Afghanistan is a virgin market with huge trade opportunities. I have promptly conveyed Munir’s August 2018 invitation to me to come and explore Afghanistan’s vast mining deposits, to our business sector. I welcome your official call today for an Investment Protection and Promotion Pact with us to revive our economic ties and shall forward it to our leaders and relevant line ministries for next steps. It is time for our bilateral trade to surge beyond the low $ 1 million levels,” said Minister Bathiudeen.
In 2017 Sri Lanka’s total trade with Afghanistan was less than $ 1 million – only $ 820,000 – and Sri Lankan exports were at $ 700,000, slightly increasing from 2016’s $ 630,000. Printed books, newspapers and other printing industry products, were Sri Lanka’s major export to Kabul in 2015, 2016 and 2017 (68% of total Lankan exports to Kabul in 2017). Imports from Afghanistan were negligible. While meeting Minister Bathiudeen in Colombo in August 2018, he called Lankan investors to mine Afghanistan’s vast mineral resources. “We have a trillion dollar worth untapped metal, mineral such as iron, copper and gold as well as mining resources including oil and gas. The global multinational companies are costly. We like to see the countries in this region and neighbours entering Afghanistan to prospect them, rather than very costly global firms. As a result we invite Sri Lankan businesses and firms to prospect in Afghanistan" said Ghiasy. A recent study by Afghan Ministry of Mines and Petroleum established natural resource deposits valued at $ 3 trillion sitting pretty in Afghanistan’s landmass.
