Indo-Pak trade

Unfortunate is the fact that in the world today, when economies are focussing on optimising their resources and opportunities, India and Pakistan have held on to the historical bitterness of partition. The two neighbours, despite immense trade potential have filtered borders for each other. Unnecessary trade restrictions add to the barriers, as a result of which informal trade, via third countries like Dubai takes place. Indian garments and hair oils are amongst the many products that enter into Pakistan crossing borders from this route. This informal trade is estimated at some 2-3 billion dollars annually, and can easily be undertaken bilaterally at significantly lower cost. Not only will this help fetch billions of dollars, but also will help to overcome the trust deficit between the two countries. "Agriculture industry will benefit a lot, if trade of all goods is allowed with India," believes Ahmad Jawad, CEO Harvest Trading Pakistan. With an Indian market of over 1.2 billion consumers, there is a lot of potential for trade of fruits including kinnow and dates. Additionally, Pakistan can import wheat and rice which is cheaper than the local variety. Similarly, he suggested that India and Pakistan could jointly market mango in the international market for eight to nine months in a year because mango season in India starts in March and continues till June while the season in Pakistan begins in June and lasts till October. According to Ahmad, fair trade will increase competition resulting in improved variety and product quality. Governments of both countries need to take active role in the execution of formal direct trade. Elimination of the requirement that ships between India and Pakistan touch a third country port before bringing in imports; Removal of the requirement that rail wagons carrying goods across the border return empty; opening additional road border crossings and bus routes; increasing air links between the two countries; and allowing branches of Indian and Pakistani banks to operate in the other country are some of the immediate matters to be resolved from both ends. The local government needs to take an additional responsibility to allow for fair trade, approving all products to be traded so that trade benefits can be reaped by both sides. Subsidy can be given to the threatened market products like rice and pharmaceutical goods. A reduction in the input cost by the government can also secure the Pakistani producers on the price competition front. It can only be hoped that the concerned authorities will not delay the policy procedure for the execution of official trade on a large scale for the mutual benefit of the two neighbours.