Pakistan and Afghanistan have a long history of being trade partner. Pakistan represents Afghanistan’s’ main access to a seaport for its foreign trade. Afghanistan, at the same time, has the potential for becoming a land linked country providing Pakistan with direct routes to the Central Asia. Transit to Afghanistan through Pakistan is governed by the Afghanistan-Pakistan Transit Trade Agreement (APTTA) which specifies the port, route, transport modes and customs transit procedures. With the passage of time, trade conditions for the transit of goods to/from Afghanistan through Pakistan have changed significantly. Both Afghanistan and Pakistan have agreed on not only to continue to provide Afghanistan with access to the sea through Pakistan but also to provide Pakistan with direct routes to the Central Asia. This discussion paper has been specially commissioned to cover issues related to trade relations between Pakistan and Afghanistan and serve as a background to Pakistan-Afghanistan Parliamentarians Dialogue.