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Pakistan Allowing Afghan Refugees to Open Local Bank Accounts

FILE - A refugee from neighboring Afghanistan sells Afghan dresses at a reception organized by the United Nations High Commission for Refugees on the occasion of the World Refugee Day in Islamabad, Pakistan, June 20, 2018.

Pakistan has decided to allow hundreds of thousands of Afghans residing in the country as legal refugees to open accounts in local banks, enabling them to formally participate in the national economy.

The country hosts more than 1.4 million registered Afghan refugees, making Pakistan one of the largest refugee-hosting nations in the world, according to the United Nations High Commission for Refugees, or UNHCR. The displaced families have fled decades of conflict, persecution and economic hardship in Afghanistan.

“I have issued instructions today that Afghan refugees who are registered can open bank accounts and from now onwards they can participate in the formal economy of the country,” Prime Minister Imran Khan tweeted Monday (@ImranKhanPTI).

“This should have been done a long time ago,” he said.

Local laws prevent refugees from conducting transactions through Pakistani banks, forcing Afghans to rely on informal channels and local partners to conduct business and trade-related activities to feed their families.

The UNHCR welcomed Monday’s announcement.

“I commend Prime Minister Imran Khan, the government and the people of Pakistan for taking this important step in support of Afghan refugees - a forward-looking, generous gesture of solidarity of global significance,” said UNHCR chief Filippo Grandi.

The refugee agency noted that opening of bank accounts will allow refugees’ extended family members, living abroad, to send remittances through formal banking channels, which will help increase the foreign exchange reserve in Pakistan.

A UNHCR official told VOA on condition of anonymity that the agency has for years been in talks with Pakistani officials to seek banking facilities for the displaced Afghan community. He noted that discussions with the Pakistani government are also ongoing to secure permission for Afghan refugees to obtain a driver's license.

Pakistan also hosts nearly a million undocumented Afghans, who are currently undergoing the documentation process. They are, however, not entitled to the banking sector because they are considered illegal economic migrants.

An Afghan refugee who fled his country due to war and famine shows his registration in Peshawar, Pakistan, Oct. 25, 2017.
An Afghan refugee who fled his country due to war and famine shows his registration in Peshawar, Pakistan, Oct. 25, 2017.

Granting citizenship

Late last year, Prime Minister Khan promised at a public rally his government would try to grant citizenship to Afghans who were born or grew up in refugee camps in Pakistan. The fate of that announcement remains unclear, however, as it instantly triggered strong criticism from some opposition political parties.

Khan has taken steps in recent days to improve Pakistan’s mistrusted and suspicion-marred relations with Afghanistan.

The prime minister tasked officials last month to make arrangements and implement them within the next six months to keep open “round the clock” the main Torkham border crossing between the two “brotherly countries” to boost bilateral trade and people-to-people contacts.

Mutual political tensions have led to indefinite and abrupt border closures in recent years, leading to a significant decline in trade between Pakistan and Afghanistan.

Islamabad is also unilaterally constructing a robust fence along a nearly 2,600-kilometer traditionally open and porous Afghan border to try to stop terrorist infiltration in either direction.

FILE - Pakistani soldiers stand guard at a newly erected fence between Pakistan and Afghanistan at Angore Adda, Pakistan, Oct. 18, 2017.
FILE - Pakistani soldiers stand guard at a newly erected fence between Pakistan and Afghanistan at Angore Adda, Pakistan, Oct. 18, 2017.

Kabul opposes the border security project because it disputes the former British colonial era demarcation, objections Pakistani officials dismiss.

Pakistan also plans to soon introduce relaxed and better facilities at its diplomatic missions in Afghanistan to facilitate thousands of Afghan visa seekers who gather daily outside the Pakistani embassy and consulates.

A Foreign Ministry official told VOA that Pakistani missions daily issue almost 4,000 visas to Afghans, including women and children, enabling them to see their relatives, seek medical treatment, education and undertake business activities in Pakistan.

Pakistani officials says all of their diplomatic missions in Afghanistan issued nearly 750,000 visas in 2018.

On a daily basis, Afghanistan’s embassy and three consulates in Pakistan issue a total of around 600 visas to Pakistanis, including laborers, business people and those working for non-governmental organizations, a senior official at the Afghan embassy in Islamabad told VOA. Under a mutual agreement, both countries issue visas free of charge.