LAHORE - The recent trade agreement between Pakistan and India has received a positive response from most of the political and business community leaders but some of them have expressed fears that the way these ties are being forged, would harm Islamabad’s interests.
Islamabad and New Delhi agreed on a trade pact during a ministerial-level meeting on Saturday with salient features of replacing Most Favoured Nation (MFN) term with Non-Discriminatory Market Access (NDMA), 24/7 truck trade through Wahga Border and a liberal visa policy for businessmen.
Whereas most of the major political parties have supported the new Pak-India trade agreement, the JI and PML-Q say that trade ties must not progress without a forward movement of other key bilateral issues, especially Kashmir and water dispute.
Some prominent business and trade leaders of the country too are dissatisfied with it. Yet some others say that the traders on both sides would not be able to get the desired benefit from trade liberalisation agreement because of the poor infrastructure, which is incapable of catering to the growing bilateral trade volume. They say that India has somewhat upgraded logistics system on her side, but Pakistan is lagging behind.
They also stressed resolving harmonisation issues and greater coordination between the Customs and Railways officials of the two sides. Some Agri sector experts believe that the new pact would harm the interests of Pakistani farmers as they cannot compete with Indian farmers because of inbuilt deficiencies in our governance and taxation systems as well huge subsidies to Indian farmers.
As for the political leaders, PTI, PPP, MQM and JUI-F leaders have more or less same views on the trade pact as they believe that enhanced trade and people-to-people contact will help resolve other key issues pending between the two nuclear states.
Naeemul Haq, spokesman for PTI chief Imran Khan, said, “PTI fully supports the trade agreement as it will open the door for increased people-to-people contact between the two states which in turn will help resolve other issues like Kashmir.”
He insisted that Khokhrapar-Munabao rail link and Muzaffarabad-Srinagar route should also be opened for enhancing trade and people-to-people contact. He said trade and normalisation of relations with all neighbours, especially India, was part of PTI’s foreign policy priorities and incumbent government’s trade pact was a step that supports their agenda.
MQM senior leader Haider Abbas Rizvi, when called, said MQM has always supported normalisation of relations with India, as “we should acknowledge this fact that we can’t change our neighbours and developing good ties with our neighbours is the only doable option”. He remarked. “This is the century of regions and not countries. Improved ties between the two nuclear neighbours will be fruitful not only for Islamabad and New Delhi but the entire South Asian region, putting it on the road to peace and progress.”
Rizvi also said that the new trade pact would increase people-to-people contact that would pave the way for resolving the other bilateral issues. And, he also insisted that other trade routes should also be opened between the two countries, especially Khokhrapar-Munabao rail link as it was the most important for short-distance trade.
The PPP has also welcomed the trade pact, but cautioned the government to ensure that Pakistan equally benefits from the bilateral trade. PPP’s secretary general, Sardar Latif Khan Khosa, told The Nation, “Given the greater size of Indian economy and its population, it is imperative to set such rules of trading that interests of our people are not compromised.” Khosa said that PPP had always been supportive of trade ties with all the neighbouring countries including India.
JUI-F central spokesman Maulana Amjad Khan, when contacted, said “We desire good relations with all our neighbours. Increased people-to-people contact in the result of this trade pact will hopefully help resolve major issues like Kashmir.” However, he emphasised the need to put other key bilateral issues on track for rapid growth of healthy relations with India.
Commenting on the government decision to open Wagha border for 24/7 trade with India, JI chief Syed Munawar Hasan said that only India would benefit from this. He said the PML-N government had pushed the Kashmir issue to the back burner, reducing the huge sacrifices of the Kashmiris to a naught. He pointed out that Nawaz Sharif was now silent even on the issue of India’s water aggression. Munawar said that by allowing free trade with India, the rulers were placing the country at the mercy of India as RAW agents as they would freely enter into Pakistan under the garb of traders and bankers.
PML-Q central spokesman Kamil Ali Agha, when reached, said that trade ties improvement should be linked to the settlement of Kashmir issue and end of water aggression by India. He warned that Pakistan and India could face each other in a nuclear war within the next decade if they failed to resolve these key issues. Kamil remarked that Non-Discriminatory Market Access (NDMA) was much bigger status than the Most Favoured Nation (MFN). He added that efforts to improve ties with India while ignoring our important and time-tested neighbours like – Iran and China – would prove counterproductive.
According to LCCI President Sohail Lashari, in view of transportation by road through the Attari-Wagah border, further up-gradation of infrastructure is required to keep pace with the expanding trade. “The major attraction for traders on both the sides is quick delivery of goods across the border and lower freight costs compared to the cost of trade incurred with other countries. Infrastructure at the Wagah border is incapable of catering current cargo loads, which often results in delays and wastage of perishable goods that India and Pakistan usually trade.”
Lashari said the land customs station is operational only 12 hours a day and loading and unloading of trucks is still manual. Additionally, there is lack of warehousing facilities on both sides and testing laboratories are not present at land ports, he said. “Although the new integrated check post has been set up on the Indian side, it is already running at full capacity,” he said. Lashari added that when the existing permissible list of goods to be imported to Pakistan via the road route expands, the facility will not be able to handle increased trade volumes.
All Pakistan Anjuman-e-Tajiran general secretary Naeem Mir said that increasing people-to-people contacts between the two countries and close interaction between the businessmen on both sides will force the both sides’ establishment and army to liberalise the relations. Trade between the two countries was virtually insignificant till 2003 when the sharp focus of the diplomats of the two countries was political issues, he said, adding that trade was given importance in 2007.
Naeem Mir said that the increase in trade between India and Pakistan slowed down mainly due to issues related to harmonisation. To resolve these issues, the two states should arrange periodic meetings of customs officials. Moreover, Railways authorities from the two sides should regularly interact to ensure smooth and adequate supply of rail wagons for transportation of goods.
Opposing free trade between Pakistan and India in present circumstances, Pakistan Agri Scientist Association chairman Jamshed Cheema said that it will be suicidal to allow free trade between the two countries as Pakistani farmers are at a disadvantage due to high input costs. “We cannot compete with Indian farmers because of inbuilt deficiencies in our governance system, high taxation and above all, huge subsidies being given to Indian farmers by their government... We are not against trade with India, we are against unequal terms of trade.”
Former Pakistan Poultry Association chairman Abdul Basit said that Pakistan should rationalise cost of farm inputs or slap a levy on Indian products for creating level-playing field between the farmers of two countries. He said Pakistani farmers have been left on the mercy of market-driven pricing mechanism as they are left with no option but to buy every farm input on retail price. The farmers are also forced to sell produce in pre-wholesale markets, he added.
Abdul Basit said that interests of farmers in India are fully protected by their government. Owing to a robust system of subsidies, growers in India bought diesel at Rs94.50 per litre in Pakistani rupees against local price of Rs117.13 per litre. Similarly, price of urea fertiliser in India is just Rs495 per bag against Rs1,700 per bag in Pakistan. DAP fertiliser is being sold in India for Rs1,685 per bag while in Pakistan farmers are forced to buy it for Rs3,200 per bag.
Pak-India Chamber of Commerce chairman SM Munir said that both countries have largely resolved the visa issue, adding that fine tuning of visa process and further simplification of documents required for visa applications was in process. He said that Pakistan enjoys competitive advantage in several fields, quoting textiles as one sector. Pakistan will benefit from the penetration that Indians are likely to make in the Association of Southeast Asian Nations (Asean) and other regional markets, he said. He said that there are infrastructural constraints on both the sides. However, the volume of trade through Wagah will triple after it operates 24/7 on both the sides of the border.
SM Munir said that besides improving roads and other infrastructure, the two sides should establish cold storage facilities at border posts. The containerised exports will enhance the trade volume between the two countries, he held. He said that indirect bilateral trade’s magnitude is greater than that of direct trade and presently estimated to be around $3 billion. He said it can render more benefits to the consumers and become a source of economic benefits to both the countries. More trade through land routes will accrue added benefit, he concluded.