Steps towards greater South Asian cooperation
India, in turn, adopted what some analysts call the ‘look east’ policy. The first step, therefore, would be to bring Pakistan back to South Asia and breathe new life into the South Asian Free Trade Area. The process has begun but there should be full commitment from both sides to maintain the momentum. There are groups on both sides of the India-Pakistan divide that have an interest in derailing the process. They must not be allowed to succeed.
The second step should be to open Pakistani space for use by India to trade with Afghanistan and beyond. Once again, there is movement here; a transit agreement is in the works for Afghanistan to trade with India using Pakistani territory. It is the flow of goods in the other direction that Pakistan is hesitant to permit. It is this inhibition that needs to be overcome.
The third step would be to link the various Asian countries through a network of oil and gas pipelines and with an electricity grid so that energy begins to flow from the energy surplus to the energy deficit countries. Some work has been done in this context. A gas pipeline is being constructed on the Iranian side of the border to eventually be linked with Pakistan. The Chinese have long been interested in connecting their western provinces with the gas-rich countries in the Middle East with a pipeline that will cross the length of the Pakistani territory. The private sector in India is planning to lay an oil pipeline from a new refinery located in Bhatinda in the Indian state of Punjab to the Pakistani province of Punjab. This will provide gasoline and other refined products to Pakistan.
It would take a great deal of investment to develop these routes of international commerce. Finding resources for building this type of connectivity is, therefore, the fourth step. Pakistan does not have the means to do this but it can be done with the help of private finance and private technology.
A programme focused on creating a regional network to facilitate trade could be launched. And it should have much greater involvement of the private enterprise. This is where an Asian centre of finance such as Singapore may enter the picture. It has the banking sector and other instruments of finance to establish a financial consortia to implement such a project. It also has a large and experienced construction industry to join such an effort. A city-state such as Singapore may well become the headquarter of a large consortium to handle these infrastructure projects.
Insofar as the financing of such an investment programme is concerned, there are several possibilities. The traditional sources would be the two multilateral development banks, the World Bank and the Asian Development Bank. To this, two more could be added. The BRICS countries are now working on the possibility of setting up a development bank of their own, which would be capitalised by them from their large external reserves. Large inter-country infrastructure construction projects would be a good starting point for the proposed BRICS bank.
In sum, it is possible to create a vibrant economic entity in South Asia. What is needed is political will and imagination on the part of various countries that would be involved.
Published in The Express Tribune, August 6th, 2012.
COMMENTS (17)
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This is more like Birbal's 'khayali pulav'. The author expects all of Pakistan's neighbours to bend over backwards to take actions to help Pakistan at a cost to themselves? May one inquire why? What will Pakistan bring to the table? Can it guarantee the safety and security of goods and people transitting via Pakistan? If not, then why bother? If you need help, you have to help yourself first. When majority of Pakistanis have their head buried in the sand with regards to the actual problems they as a society and country face and would rather push the blame to 'foreign hands', how can one expect any moves to correct the situation? And in the absence of such moves, why would an outsider willingly venture into Pakistan - to trade ot transit?
@kaalchakra:
You can keep dreaming and venting out your ignorant hate-mongering without understanding the basics of global economics. Welcome to the age of globalization, in case you have woken up from your stone age. I wonder which of the Central Asian republics would be interested in investing in or collaborating with Pakistan's bankrupt economy which has more terrorist activities than nation-building and wealth-generating fundamentals. The first essential thing for Pakistan would be to discard its madrasah begging culture (and whining all the time that they have done so much for the USA and are not getting enough in return) and engage in some constructive work that will benefit future generations. You urgently need economic reforms to revive the economy, generate more taxes and stop the feudalistic society that has impeded progress and formented petty thinking that helps vested interests (feudal lords, military, mullahs, etc.). Besides your textile industry, there is no other viable industry in Pakistan (read WB, IMF reports) to generate wealth for the nation. Even Bangladesh, which is a free country now, is prospering more than Pakistan. Don't even think of comparing yourselves to India or China which are way ahead.
@Vikas: " No sane Indian will ever invest in Pakistan. " Now that ManMohan has opened the floodgates of FDI from Pakistan, it is going to be the other way around. Make way for the flood of non-existent billions pouring into India and sweeping us off our feet. And, we are talking dollars, not anemic Pakistani rupees!
The author is in some Disney land. No sane Indian will ever invest in Pakistan. Pakistan is going to be a dumping ground for Indian goods. Nothing more, nothing less.
Javed Burki is a sane person in an otherwise insane country Pakistan. What Gandhi, Jinnah failed to achieve, can never be achieved by present generation leaders. I think what Abul Kalam Azad wrote on Pakistan demand was prophetic- it will be huge burden on our exchequer, allow foreign powers to meddle in our affairs. This animosity is too big to bridge, now made permanent by creation of Pakistan. Efforts should be made for peace, but it will always be suspected. Total erasure of minorities from Pak has only accentuated this.
You can't have thriving economies with free trade throughout the region so long as Pakistan remains the hub of terrorism -- may not be a politically correct thing to say but it's obvious to everyone but Pakistan. Your country tried to make money on the WOT rather than actually get rid of terrorism -- now you have multiple militant armies that you have little or no control of which make investment in pipelines, trade, infrastructure etc impracticable. Make Pakistan a tolerant peaceful country that is respected by it's neighbors and then write articles on how to expand trade.
In sliding world economy Pakistan hardly has many options. Sooner or later she will have to come to terms with her neighbors. Gone are the days of free American and Saudi money.
Excellent ideas Sir, I hope the Governments take your suggestions seriously.
@Abbas, John:
Once the percentage of minorities has fallen below a trigger threshold, it will provide a powerful incentive to many, and not just in India, to scrub clean west Punjab and Sindh, and certain West Asian hangers-on, and begin anew with a clean slate. The presence of the depth of hate as we have seen on ET comments, and on other papers, can only reaffirm such convictions. No one can have relations with such abnormal mindsets, and the world will also concur. From Burma to the USA, we have the same threatening message, and the reply will be the same.
@Waziristani: " ... A Confederation among South Asian countries can heel our wounds. ... "
The Caliphate project did not take off I guess. Return to your original Vedic/Indic faith, then we can talk confederation, single currency, etc. Otherwise, look West to your Ummah.
BRICS will fund, Singapore will provide HQ for consortiums of financial service providers and infra developers, India will trade with Afganistan and Central asia, China and India will pump gas from Central asia and Middle east via pakistan. All will benefit Pakistan in the name of South Asia!!! Does the author care to mention what is the motivation for other countries to help Pakistan given its involvement in the spawning of terrorism and spreading religious bigotry. Does the author care to mention that other south asian countries like Srilanka, Bhutan, Bangladesh, Nepal etc trade freely with India to mutual benefit. If anyone is not in, it is Pakistan, It is upto Pakistan to change its policies and trade to its betterment. Simply acting as a toll gate will not be enough even when NATO trucks are not safe.
You have eradicated Hindus to 1.6% in Pakistan and now you want to establish trade relations with India. What makes the author think that a islamic den of terrorism will be tolerated by Indians?
Clear, precise 4 steps!! I agree with the author that the maximum stability model for economic growth and integration lies much closer as it existed in pre-1949 which is south asia and Pakistan must do all it can to make a 1st step in this direction. Pakistan will find to its surprise how many countries in its neighborhood will want to work with it. Pakistan will be seen as a harbinger of new economy in this part of the world. Pakistan need to help itself for others to help it in achieving this.
Kaalchakra, it seems you are deeply affected by some Pakistani bug known in Pakistan as 'India'. If you call that last 65 year effort 'trying' then you need this realization that duplicitous actions have never produced results anywhere in the world. You can't talk sweet while harboring terrorists and dreaming of Islamizing India all the way to East Pakistan..that didn't quite happen as planned although the cultivation of Jihadi networks in India continues !!
A Confederation among South Asian countries can heel our wounds.
Totally agree- peace, trade n business at regional level is the only way to prosperity and economic boom for the whole SAARC. Pakistan and India will have to play a decisive role to meet this end. This is the ultimate solution and writing of the wall. Now, lets see how much time we take to embrace this reality.
Sir, all efforts aimed at establishing fair trade relations with India have failed during the last 65 years. Instead of chasing that mirage deeper into the desert of wasted time, Pakistan needs to plan seriously for full integration in its natural circuit - the central Asian marketplace.