A delegation of Iranian diplomats recently visited Kunduz Province in northern Afghanistan to engage in trade discussions with local officials.
“The Consul General of the Republic of Iran in Mazar-e-Sharif has discussed the expansion of commercial relations with the local authorities of this province with a number of diplomats [of Afghanistan] during a trip to Kunduz Province,” the head of foreign relations of Kunduz Province, Asadullah Niazi said, according to a report by Afghan Voice Agency.
During the visit, the Iranian delegation, led by Sayed Hussein Yahyawi, Iran’s consul-general in Mazar-e-Sharif, met with the Governor of Kunduz Province to address significant commercial and economic matters. The discussions encompassed topics such as transit, increased business exchanges, and the development of the tourism industry between the two countries.
Since the rise of the Islamic Emirate, Iran’s interest in investing in Afghanistan has grown, prompting efforts to expand economic and trade relations between the nations. On April 30, Iranian President Ebrahim Raisi emphasized the importance of using the Iranian rial instead of US dollars for business and trade with Afghanistan and other countries. He expressed confidence in the viability of this approach and its potential to play a valuable role.
“We can use our rials with Iraq, Afghanistan and some regional countries. This can absolutely be done. There are other issues which need to be discussed and it can certainly play an effective and important role,” the president said.
However, concerns have been raised by some economists who argue that adopting the rial as the currency for trade with Iran could have adverse effects on Afghanistan’s economy. Economist Azeraksh Hafizi said that employing the rial would not benefit Afghanistan as it would increase currency balance deductions and limit the circulation of the national currency.
Meanwhile, the Afghanistan Chamber of Commerce and Investment (ACCI) announced plans to establish a joint chamber of commerce between Afghanistan and Iran. The formation of this joint chamber is expected to boost trade and investment opportunities, enhance economic ties, and facilitate communication and collaboration between business communities and entrepreneurs from both countries.
With a shared border spanning 815 kilometers, Iran has been Afghanistan’s top trading partner and a crucial supplier of fuel to the eastern neighbor. At the same time, in the fiscal year 2022-23, Iran’s trade with Afghanistan, including non-oil exports and imports, stood at 3,405 tons valued at $1.66 billion, experiencing a 10 percent decline compared to the previous year.
Iran and Afghanistan have long been engaged in a dispute over the Helmand River. Iran has persistently objected to the construction of the Kamal Khal Dam, asserting that it would lead to the drying up of its wetlands in the Sistan-Baluchestan border province. Experts from Iran warn that Lake Hamun, situated along the Afghan-Iranian border, and numerous wetlands fed by the Helmand River may face depletion due to the water intake at the Kamal Khan Dam.