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    Posted on 16 February 2012
    Tridivesh Singh Maini

    Money heals faster than words do

    Tridivesh Singh Maini analyses how trade can bolster growth in India and Pakistan

    Illustration: Tanmaya Tyagi

    COMMERCE MINISTER Anand Sharma’s four-day visit to Pakistan along with a high-powered delegation, which began on February 13, will hopefully give a fillip to trade between both the countries. The delegation, which includes some top Indian industrialists, would visit Lahore, Karachi and Islamabad. Sharma has already met his Pakistani counterpart Makhdoom Amin Fahim. He will also be meeting Prime Minister Yousaf Raza Gillani and calling on President Asif Ali Zaradari.

    Sharma participated in the India Show, an exhibition of Indian goods, and interacted with members of the Pakistani business community as well. The main aim of the visit was to push the level of bilateral trade from the current figure of $2.7 billion to $10 billion. The delegation is also scheduled to discuss issues pertaining to infrastructural problems and current cargo facilities and the issuance of multiple entry visas to businessmen of both countries.

    Sharma favours an early conclusion and signing of an agreement for a multiple entry visa regime to facilitate the movement of business leaders of India and Pakistan as part of this process of normalisation and strengthening of economic relations. However, the formal announcement, to be made by Pakistan regarding MFN Status to India, will have to wait for the moment since the negative list of items for trade is not likely to be finalised by February end. It is also believed that certain sections of the business community harbour apprehensions that Indian goods may flood the Pakistani market. While the current prime minister’s vision and Sharma’s initiative should be hailed as economics promises to be the most realistic bridge builder between both countries. However, a few crucial obstacles may impede progress on this front, however.

    Firstly, both the governments will face pressures to retract on their commitments which they have made with regard to cross-border trade. Anti-India elements such as Hafiz Saeed head of Jamaat-ud- Daawa has already upped the ante and invoked the emotional issue of India stealing Pakistan’s water in a fiery speech in January, while also opposing MFN status to India. Saeed was interestingly snubbed on a Pakistani talk show by senior Congress leader, Mani Shankar Aiyar only a few days back. While sections of the business lobby in Pakistan would be opposed to Saeed’s stance, there are elements to whom he appeals and it may become politically untenable for the leadership to sell trade with India.

    While it is believed that there is a change of mindset in the Pakistan army with regard to India. It is quite plausible that sections of the army which are miffed with Prime Minister Gillani’s aggressive stand with the army, may try to scuttle further movement in the realm of trade and prop up Saeed, who is contemplating a political career.

    Some Indians who are opposed to engagement with Pakistan would point out that India has nabbed Kamal Chauhan, the culprit of the 2007 bombings in Samjhauta Express near Panipat (Haryana) when the bi-weekly train was heading from Delhi to Lahore. The majority of the 68 people who died in the blast were Pakistanis. Pakistan, on the other hand, has not taken concrete action against Saeed who roams freely making inflammatory speeches. They would argue that business in such a climate is senseless and India’s stance on terrorism emanating from Pakistani soil would be diluted. Indian Prime Minister Manmohan Singh is already facing scathing criticism, being dubbed weak, for his policy of engaging with Pakistan.

    A PART FROM political hurdles, the tardy pace of infrastructure development at the borders threatens to be a major impediment to trade. A perfect example of this is the slow development of the Integrated Check Post (ICP) at Attari. While this was supposed to be functional on February 13, it will not be operational before April. Delays in infrastructure development at border is not new in India. This is one of the primary reasons for cross-border trade with other neighbours, besides Pakistan, not taking off. India has still not realised the relevance of borders as connectors and zones of opportunity. Amid these ground realities, it would be utopian to expect that India-Pakistan trade would kick off overnight without hiccups.

    Tridivesh Singh Maini is Associate Fellow at the Observer Research Foundation in New Delhi
    [email protected]

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    Posted on 16 February 2012



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