On July 18, Afghanistan and Pakistan signed a historic transit trade agreement that will reduce by half the amount of time it takes goods to cross the border between the two countries. The Afghanistan-Pakistan Transit-Trade Agreement (APTTA), once ratified by the governments of Afghanistan and Pakistan, will be a major overhaul of the 1965 agreement, the last transit agreement in place.  APTTA updates and improves the joint transit system to reflect current economic conditions, infrastructure, technology, and transport practices.  The new transit regime increases the number of transport routes available to trucks from both countries, lowering the cost of imports and making exports more competitive in the global market.

Unlike the 1965 agreement, APTTA does not limit Afghanistan and Pakistan to the two current trade routes and one railway system.  APTTA provides for 10 additional transit corridors in Pakistan and eight new corridors in Afghanistan.  This increased freedom of transit will link Pakistan to the Central Asian countries of Uzbekistan, Tajikistan, Turkmenistan, and beyond to Kazakhstan and other key trading partners.  Pakistan will also benefit from improved access to raw materials from Central Asia.  Similarly, APPTA will link Afghanistan to the world via three Pakistani ports under designated routes.  Afghan trucks will now be allowed to transport Afghan exports to any of the three Pakistan seaports (Karachi, Qasim, and Gwadar), load goods, and return with imports from third countries or Pakistan.  Moreover, APTTA will allow Afghan exports to be transported to India and China. 

Both countries agreed to increase cooperation to control informal trade and take measures to increase the modernity and security of the current transit system.  Tracking devices will be installed on trucks to monitor their locations.  Authorized agents, such as shippers and brokers, will provide financial guarantees for payment of customs levies of transiting imports. These will be released once transit imports exit the transit country.  Both countries will also provide each other with Customs-to-Customs information on clearance of cargo at their final destination point.

TAFA assisted in eliminating key policy and technical bottlenecks obstructing the signing of APTTA.  During the final round of negotiations, which took place in July 2010, TAFA advisors assisted the negotiating team to understand the various alternatives and commitments available, particularly concerning the revised dispute resolution mechanism and measures to counter smuggling.