AFGHANISTAN: Iran fuel ban hurting the poor, says minister

Thursday, January 13, 2011

KABUL, 13 January 2011 (IRIN) - A sharp rise in fuel prices caused by a recent Iranian fuel export ban, against a backdrop of rising global fuel prices, has bumped up food and medicine prices across Afghanistan, prompting concerns about the welfare of millions of vulnerable Afghans this winter.

Petrol and diesel prices have jumped 10-15 percent (with petrol rising from 45 to 55-58 afghanis a litre) since Iran blocked hundreds of Afghan fuel tankers on its border over two weeks ago. Afghanistan gets 30-40 percent of its fuel from or via Iran, according to the Afghan Ministry of Commerce and Industry (MoCI).

Tehran’s ambassador in Kabul, Fida Hussein Maliki, said his government wants to control fuel exports to or via Afghanistan to ensure that NATO and US military forces in Afghanistan are not using the fuel. NATO and Afghan officials say the blocked tankers were only importing fuel for Afghan civilians. “If the fuel was for NATO forces it would not have such an immediate and strong impact on our market,” Anwar-ul-Haq Ahadi, the minister of commerce and industries, told IRIN. “Transport is the backbone of commerce in this country and when transport is expensive everything is going to be expensive,” he said.

Wheat flour, cooking oil, firewood and some medicines had become slightly more expensive since the fuel prices rose, local merchants and shopkeepers said. “In winter demand for fuel for heating goes up. Now, not only is fuel expensive but everything else is also getting expensive,” said Haji Abdul Hai, a fuel importer.

Iran’s actions had resulted in over US$100 million losses for Afghanistan as of 10 January, the Afghanistan Trade Chambers said. Aid agencies such as the UN World Food Programme use hauliers to import aid, and a rise in transport costs could also affect their activities. Transit access and politics Landlocked Afghanistan imports fuel, food, medicine and other commodities primarily over land, and relies heavily on the granting of transit access rights.

With US support, a new Afghanistan and Pakistan Trade and Transit Agreement (APTTA) was signed in November 2010 which is supposed to facilitate greater transit and trade. The country also has a transit agreement with Iran but it is deemed “out of date”, according to MoCI officials. “

As Iran faces increased international sanctions over its nuclear programme, it tries to hit back at the international community by pressuring Afghanistan through transit bans, refugee deportations and other means,” Saifuddin Saihoon, a lecturer at Kabul University’s economy faculty, told IRIN. Maliki, Iran’s ambassador, rejected such criticisms, saying Tehran had maintained good relations with Kabul.

Despite the presence of about 100,000 US and over 40,000 other NATO forces in Afghanistan, President Hamid Karzai has given assurances that his country would not be used as a launch pad for an attack on Iran. Iranian officials accuse US/NATO forces of destabilizing regional security and have called for a withdrawal of US-led forces from Afghanistan.

But Afghan ministers are not pleased: “We cannot act at the behest of others [foreign states] and it would be unfair if they [Iranians] keep us under pressure. This is not friendly and Afghans are not satisfied,” said Ahadi, the MoCI minister, adding that trade and transit must be not abused for political purposes. The Afghan government said it has been looking at the possibility of importing fuel from Kazakhstan and Russia. “We’re not living in an ideal environment,” said Ahadi “so we have to make every effort to mitigate the impact of the current fuel crisis.”