Restarting trade with India stays elusive

There is no consensus among the stakeholders regarding the restoration of trade relations between Pakistan and India, according to the people familiar with the development.

Foreign Minister Ishaq Dar, speaking at a news conference in London on Saturday, indicated that Pakistan would give serious consideration to re-establishing trade ties with India, echoing sentiments expressed by the business and trade community within the country.

Pakistan suspended bilateral trade as part of a raft of measures in reaction to the Indian government's unilateral move to revoke the special status of disputed Indian Illegally Occupied Jammu and Kashmir (IIOJK) on August 5, 2019.

Islamabad had previously tied the resumption of trade with India to a reconsideration of India's decision regarding IIOJK.

Read more: Why Pakistan and India should resume trade

In March 2021, the Pakistan Tehreek-e-Insaf government was close to lifting the ban when the Economic Coordination Committee (ECC) of the cabinet agreed to partially open trade with India. However, the decision was vetoed by the federal cabinet after some members warned then-prime minister Imran Khan that the decision would be a political suicide.

At the time, the security establishment under then-army chief General (retd) Qamar Javed Bajwa was eager to normalise ties with India.

Dar's latest statement suggested that there may be a renewed push to break the ice in the relationship with India.

Also read: FM says govt to ‘seriously’ consider reviving trade with India

Sources, however, told The Express Tribune on Sunday that there was no concrete proposal on the table at this stage regarding the resumption of trade ties between Pakistan and India.

It is believed that there are differences of opinion among the stakeholders regarding the move. Even within the Foreign Office, there are divided views, something sources said was not unusual.

Some are in favour of sticking to Pakistan’s stance that without any major concessions from India, there shouldn't be any normalisation.

However, others take a more pragmatic and realistic view. They believe Pakistan can take a page out of China’s playbook. China has uneasy ties and border disputes with India, yet this has not deterred the two rivals from trade ties.

While Gen (retd) Bajwa was keen to improve ties with India, there is little clarity when it comes to his successor. Some observers think that Dar's statement on the resumption of ties may have the blessing of the powers that be.

The proponents of resuming trade ties with India believe that regional trade could help Pakistan mitigate its economic troubles.

A study conducted by an international financial institution spoke of the great trade potential between Pakistan and India. The study shows that the true trade potential between Pakistan and India could be over $25 billion.

Official sources, however, are sceptical about the positive outcome. The Foreign Office thinks Pakistan must wait until the Indian elections, which are scheduled to take place in different phases in April and May.

The clear picture would emerge only once a new government is in place in New Delhi in May.

Indian Prime Minister Narendra Modi congratulated Shehbaz Sharif on his election victory, but his terse statement raised many eyebrows.

Observers believe that despite the tense relationship, Modi’s message seems to suggest that India wants to keep the window of talks open with Pakistan.