Pakistan’s location gives it natural corridor advantages linking South Asia with Central Asia, the Middle East, and Europe. Yet transit trade performance remains inconsistent despite multiple agreements, infrastructure investments, and the availability of tools like TIR.

The core problem is not geography or treaties. It is execution.

Through corridor-level analysis, one conclusion becomes clear: transit trade functions as a commercial operating system, not a diplomatic aspiration. When financial settlement, driver mobility, customs controls, and institutional governance are misaligned, corridors fail—regardless of agreements.

Across Pakistan’s corridors, three binding constraints repeatedly appear:

Banking compliance:

Sanctions regimes, particularly OFAC, do not prohibit trade—but banks over-de-risk due to uncertainty. Pakistani banks already possess KYC, AML, and screening capacity. What is missing is regulatory confidence. Without SBP-anchored clarity, legitimate transit trade is pushed out of formal channels.

Driver mobility:

Driver visas are often treated as administrative issues, but they are core supply-chain variables. Transit cargo belongs to destination-country traders. Visa delays raise their logistics costs, disrupt schedules, and weaken corridor reliability. Security and speed are not opposites—pre-verification and traceability enable both.

Execution discipline:

Customs, border forces, transport authorities, and banks operate in silos. Without unified ownership, SOPs, KPIs, and exception handling, even well-designed policies underperform. This is where DG Transit Trade (DGTT) must function as the corridor operating authority—not merely an enforcing office.

A critical lesson comes from APTTA, where weak border controls, inconsistent sealing, lack of post-exit audits, and unregulated cross-docking enabled diversion of transit cargo back into Pakistan to evade duties. Blanket enforcement followed—but punished compliant trade without fixing root causes.

The solution is risk-based governance, not restriction:

• OFAC-aligned banking compliance perimeters
• Secured-but-fast transit driver visas
• Codified, supervised cross-dock rules
• End-to-end assurance chains
• DGTT-led corridor KPIs and accountability

TIR is necessary—but not sufficient. Corridors perform only when banking, mobility, customs controls, and governance work together.

Transit trade is not a theory. It is a revenue-generating system. Execution—not announcements—will decide whether Pakistan becomes a corridor or remains a bypass.