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BR Research

Whats the point when you miss the point?

Published December 7, 2010 Updated December 7, 2010 12:00am

Just when WikiLeaks has been revealing sweeping statements about bilateral relations between many countries, Pakistan and Afghanistan have been making efforts to try to present their best foot forward as far as the relationship between the two is concerned.
In the talks held between the Pakistani Prime Minister and Afghan President on Saturday and Sunday, bilateral trade between the two prominent nations (though not prominent for the right reasons) was stressed. In FY10, trade with Afghanistan was around 2.5 percent of the total trade of Pakistan, of which the major chunk is exports from Pakistan into its land-locked neighbour.
While Afghanistan sells dry fruit, animal skin and fur, carpets, fruit, etc into Pakistan, Pakistan exports mainly wheat and flour, cement, and some metals to its north-western neighbour.
With total exports hovering around a meagre $400 million last year, Afghanistan ends up being quite a trade-deprived country, and the agreement for intensifying trade with Pakistan should be hailed by the countrys commerce officials.
The two officials emphasised trade and regional cooperation between the two economies, especially in terms of energy cooperation, infrastructure development, investment opportunities, and education.
An emphasis on the exchange of intellectual capital was particularly underlined as evident from statements such as "support establishment of agricultural research institutions in Afghanistan" and "enhance bilateral interaction for effective utilisation of 2,000 scholarships for Afghan students announced by Pakistan over the next three years".
The sweet-talk however, has conveniently sidelined the graver issue of undocumented trade and smuggling carried on along the borders separating the two nations. The Karachi Chambers of Commerce and Industry places a rough estimate of around $2 billion to the annual loss due to the illicit trade with Afghanistan.
There are statements, though, stressing upon the harmonisation of tariff structures across the two countries which can help curb smuggling of goods, originally meant for Afghanistan, into Pakistan. One hopes to see more tangible implementation of these statements in the near future.
Besides, while the implementation of the APTTA (Afghanistan-Pakistan Transit Trade Agreement) had not been forgotten, Pakistan shouldve also bargained for access to the Central Asian region through Afghanistan as a barter agreement.
The talks, therefore, are quite a hoodwinking pastry - the propositions are colourful, but the more pertinent issues were put to the side. The two leaders have aimed at a target of bilateral trade worth $5 billion while officials trade between the two countries flitted around $1.5 billion in FY10, meaning a bridge of $3.5 billion needs to be covered.
But one cannot help but keep the fingers crossed that the additional $3.5 billion envisaged by the two leaders doesn take the form of illegitimate trade.

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