By R. Rakendu
When the Taliban regained power during August 2021, it triggered a major evolution in trade relations between India and Afghanistan. The Afghan export data to India according to the Ministry of Commerce showed substantial growth, while the exports of India to Afghanistan experienced a downward trend. An astonishing trade deficit has been noticed between Afghanistan and India since the Taliban took control.
According to the data of 2023-24, it was demonstrated that India imported $642.29 million worth of merchandise from Afghanistan which became their highest export record to date. The primary exports from Afghanistan to India included- sediments such as saffron along with raisins, figs, apples, potatoes, almonds, apricots, onions, garlic, pomegranates and mixed nuts. The volume of Afghan products entering India experienced major growth while Indian exports to Afghanistan diminished at an unprecedented rate.
The export numbers from India to Afghanistan shows a continuous downward trend during the previous several years. The value of Indian exports to Afghanistan deteriorated from $825.78 million in 2020-21 to $355.45 million in 2023-24. The substantial drop of Indian exports to Afghanistan stands in direct opposition to rising Afghan trade volumes toward India which demonstrates substantial trade changes.
The export value of Afghanistan dropped by $28 million in January 2025 when measured against previous months’ result which totaled to $162.2 million. The primary export markets for the country consist of its neighboring destinations Pakistan and India and the United Arab Emirates. The import market of Afghanistan continues to rise through significant imports from Iran, Pakistan and China. The January 2025 import figures for Afghanistan reached $1.04 billion while creating a rising national trade deficit and raising dependency on imported products.
The World Bank documented a 14% drop in Afghan export activity between January to September 2024, when compared to the corresponding period of 2023, during the analysis of the country’s export economy challenges. The increase in imports shows that Afghanistan is steering its economic direction toward consumption rather than production-focused approaches.
Both India and the Taliban-run government have shown interest in strengthening ties by implementing higher-level diplomatic activities between the two nations. The emerging data of trade shows that economic relations between the two countries could become increasingly connected, while both parties will confront challenges together with prospects.