Trade for peace in South Asia

Cooperation in scores of trade areas will bring peace and prosperity to region.

ISLAMABAD: In the 18th century, a French social critic and political philosopher, Montesquieu, thought that commerce improves manners and cures most destructive prejudices. The concept is now gaining currency that inter-regional as well as intra-regional trade will lead to peace among nations that have conflicts and seen many wars.

Two rival nations will become reciprocally dependent if they negotiate on trade for mutual gain with interest that it will automatically secure peace. He was convinced that trade based on mutual dependency satisfies the needs of states and discourages conflicts.

The South Asian region has been facing many challenges for long, including terrorism, border conflicts, energy crisis, population explosion, water scarcity, climate change, volatile economic growth, poverty, irregular urbanisation, etc.

Most of these threats are transnational and are not confined to national boundaries, which undermines peace and security in the region. There is a dire need for cross-border cooperation and collaboration among countries as well as regions. Unless all the countries in the region cooperate to cope with the emerging challenges and threats to human security through a workable framework, they will not be able to have a prosperous South Asia and have to face serious consequences. In fact, traditional methods to address the challenges have backfired.



Owing to a lack of connectivity, South Asia is far lagging behind other regions in the world. It is, however, believed that if countries within South Asia start cooperating with each other in energy trade (oil and gas), transport, telecommunications, textile, pharmaceutical and other areas, this will no doubt bring peace and prosperity in the region. South Asian Association for Regional Cooperation (Saarc) through its integrated policy approach could be a building block to bridge the gap among states and achieve targets.

Improved trade relations among South Asian states will definitely reduce conflicts between the rivals. For instance, Pakistan going to grant most-favoured nation (MFN) status to India is a positive step that eases tensions between the two sides. Now is time for India to facilitate the process.

India and Pakistan are the largest emerging economies in South Asia and their ties will definitely have wider implications throughout the region. Friendly relations between the two will multiply benefits for the whole South Asia and could be a catalyst for peace in the region.

Strong ties between India and Pakistan will pave the way for resolving other issues between them including the Kashmir dispute because of mutual gain, interest and dependency.

Recent agreements between Pakistan and China on Gwadar Port and between Pakistan and Iran on gas pipeline must be appreciated and supported by other countries including the business community in South Asia in order to create healthy environment.

India initially was part of the gas pipeline project in 1999, but in 2008 pulled out after signing a civilian and nuclear energy deal with the US. Iran has already expressed interest in expanding the pipeline to China and Bangladesh (according to Sustainable Development Policy Institute’s economic research bulletin Nov-Dec 2012).

Inter-regional trade

As we have been witnessing that the energy crisis has eaten away most of our industries, causing huge losses. If South Asia and Central Asia cooperate with each other, the energy crisis can be overcome because, on one side, South Asia is an energy-deficit region but has huge potential for growth while on the other Central Asia is rich in oil and gas.

This cooperation will prove to be a win-win situation for both as it will bring economic growth to Central Asian states in the shape of oil and gas revenues and will help South Asia speed up economic growth and development. By doing so, both regions will definitely secure peace and prosperity.

In order to connect South Asia and Central Asia and reap benefits of Pakistan’s geo-strategic location, Islamabad must develop internal infrastructure, especially transport and communications facilities. For instance, Pakistan Railways has huge potential for national and regional trade. So, in a bid to improve connectivity, a railway network from Wagah to Torkham can serve as a trade bridge between countries of South Asia and Central Asia.

The writer is a public policy analyst and consultant at the Sustainable Development Policy Institute, Islamabad

Published in The Express Tribune, March 25^th, 2013.

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