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kazakh-afghan business forum: possibilities for bilateral engagement

Kazakh-Afghan Business Forum: Possibilities for Bilateral Engagement

Author: Meray Ozat

Aug 11, 2023

Image source: twitter

Following the United States’ withdrawal from Afghanistan in 2021, Afghanistan has been largely abandoned by Western countries. Since the Taliban’s takeover of Afghanistan in 2021, the governments of the bordering Central Asian countries, while not as actively participating in Afghan affairs as before, have been monitoring the developments in Afghanistan, as it remainsa strategically and geopolitically important country to Central Asia. While the international community remains largely critical of the Taliban regime, Central Asian countries have started to look for opportunities to rebuild peace and security in the region by working strategically with Afghanistan’s new political and economic entities. 

Bilateral trade has recently become an opportunity for burgeoning relations with the Taliban government, with the most recent example being the Kazakh-Afghan Business Forum that took place on August 3 in Astana. With the participation of over 300 officials and entrepreneurs, the forum resulted in the signing of 15 agreements worth $190.8 million. The forum marks a major milestone in Kazakh-Afghan relations and represents a new era of cooperation between Central Asia and Afghanistan. The achievements of the forum can be categorized into three important areas: trade and economic relations, transportation and logistics, and humanitarian support. 

Prior to this development, Kazakhstan had already established a close trade relationship with Afghanistan. In 2022, the trade volume between the two countries reached nearly $1 billion, a twofold rise compared to 2021. The trade dynamic consists primarily of Kazakh exports to Afghanistan, constituting 90% of the total bilateral trade. The top exported product from Kazakhstan to Afghanistan is flour, which comprises 70% of Kazakhstan’s total flour exports. Meanwhile, imports byKazakhstan from Afghanistan have also increased, with the total value reaching more than $9 million in 2022. 

The Deputy Prime Minister and Minister of Trade and Integration of Kazakhstan, Serik Zhumangarin, revealed that the two countries might further build their bilateral trade, aiming to increase the trade turnover to $3 billion. The Chairman of the Presidium of Atameken National Chamber of Entrepreneurs, Raimbek Bolatov, also expressed a plan to establish a “trading house” in Afghanistan, fostering connectivity between neighboring countries such as Pakistan and Iran.

In addition to the focus on trade, another highlight of the forum was the development plans for transport routes and logistical infrastructure. Afghanistan's strategic geographical location places it at a vital crossroads that links South Asia with Central Asia and the Middle East. Despite its advantageous geographical position, Afghanistan has served as a primary obstacle to regional trade due to internal instability in the past. Elimination of the trade barrier and turning Afghanistan into an important bridge requires effective utilization of the location. Therefore, the forum discussed launching the trans-Afghan transport corridor, the Mazar-i-Sharif-Kabul-Peshawar railway, which creates the shortest intraregional route and allows smoother cooperation among Central Asia, South Asia, and the Middle East. 

In practice, this new route would serve as a valuable complement to the Middle Corridor. It should be noted that South Asian countries like India and Pakistan, as permanent members of the Shanghai Cooperation Organization (SCO), have strategic and economic importance for Kazakhstan and the entire Central Asian region. The Vice Minister of Trade and Integration of Kazakhstan, Kairat Torebayev, revealed that a new trade route that connects Pakistan with Kazakhstan through Afghanistan is under construction with a total length of 4000 kilometers (about 2485.48 mi). Therefore, the regional countries will also benefit from the route by unlocking new trade opportunities by accessing external markets. 

The third theme addressed during the forum focused on developing humanitarian assistance to Afghanistan and helping the country rebuild its economy. Since 2021, Kazakhstan has sent 10,000 tons of humanitarian aid to Afghanistan. During the Astana International Forum in June 2023, Kazakh President Kassym-Jomart Tokayev also proposed opening a United Nations Regional Center for Sustainable Development Goals for Central Asia and Afghanistan in Almaty to facilitate the supply of humanitarian assistance. Kazakhstan, along with other Central Asian countries, will continue to support Afghanistan, preventing the escalation of a humanitarian crisis. 

The forum marked a noteworthy advancement in Kazakhstan-Afghanistan relations by demonstrating a strong commitment byboth sides to foster bilateral ties, despite trepidation from the International Community toward Taliban-led Afghanistan. This exchange has yielded a series of positive outcomes that mutually benefit Kazakhstan and Afghanistan. First, the strengthened economic relations bolster the economies of both countries by eliminating trade barriers and allowing an expansion through the trans-Afghan transport corridor. Furthermore, the Kazakh-Afghan partnership will contribute to the region's connectivity, attracting more foreign business engagement and enhancing the region's international reputation. Finally, Kazakhstan’s support and willingness to cooperate will help Afghanistan to restore some stability to its economy, thereby mitigating the risks of terrorism and further building regional resilience.

Yet, progress in Kazakhstan-Taliban relations has triggered concerns from the international community because the Taliban regime has not acquired any formal international recognition. Along with the potential threat of terrorist activities, the strengthened relations between the two countries have become controversial. In response to the concerns, Kazakhstan maintainsthat it strictly follows the directions of the United Nations on the status of Afghanistan. However, officials stressed that the deal with the Taliban is a pivotal measure for Kazakhstan to restore regional stability and ensure sustainable development. Controversial as it may be, the forum overall can be viewed as a tangible step toward the formation of stable regional ties as well as an attempt to foster some stability in the aftermath of the Taliban-takeover's spillover effects into the region.

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