India and Pakistan: To trade or not to trade?

The India-Pakistan bond has been careworn since the aggressive partition of British India in 1947; the after-effects of which are still haunting the mankind from both sides of the border. The Kashmir issue, cold war, infiltrations, firings, terrorism and piracy issues are affecting the socio-economic and regional ties between both the nations.

India and Pakistan have had no formal bilateral trade agreement. India granted the MFN status to Pakistan in the year 1996. The Commerce Ministers of India and Pakistan, following the blueprints of the 5th SAARC Business Leaders Conclave, have taken some positive steps to improve the present relations between both nations by assuring the commitment of their Governments to expeditiously establish normal trading relations and in this context to provide Non­-Discriminatory Market Access (NDMA), on a reciprocal basis. However, there are a few issues which both governments might have to resolve through dialogue as listed below-:

1. The issue of Kashmir separates the two countries. Presently, differences over the question of demilitarization and self-governance in Kashmir persist.

2. The bilateral water disputes like the Wullar barrage-Tulbul project, Kishanganga project, Nimoo-Bazgo hydroelectric plant are still pending.

3. India-Pakistan bilateral trade in 2012-13 was $2.3 billion (Indian exports to Pakistan are $1.84 billion and imports from Pakistan are $ 513 million). Pakistan exports to India crossed $500 million mark for the first time during this period, thus creating a deficit between the import-export equations that the two countries share.

Pakistan is known for its second largest salt mine in the world, fifth largest gold mine, seventh largest copper mine, fifth largest coal reserves, seventh largest wheat and rice production capacity (can be enhanced to be the largest) and is positioned eighth in the rankings of fresh water availability. India on the other hand is a renowned name in both biotic and abiotic natural resources like natural gas, metals as well as pharmaceuticals, laborers, top-class engineers, and world’s fastest growing economy. If both Pakistan and India unite with all of their will, power, skill and labor, the region could become one of the most developed regions in the World.

Pakistan recently allowed foreign investment in service, infrastructure and social agriculture which is an opportunity for Indian companies should avail. Therefore the time is most ripe for these neighbors to look for the possible future endeavors together in the line of welfare of the people and spirit of common market and resolve the issues hindering successful trade relations. Low cost goods and services with more efficient production will definitely enhance savings, research, education and employment. Therefore, a strong political understanding should be executed from both sides realizing their gargantuan unutilized potential.