After Sunday’s attack at the Wagah border, a setback to trading activity has been envisioned as a backlash.
However, hope is keeping the business community optimistic over the future of bilateral trade between Pakistan and India.
There were reports of bilateral trade being suspended soon after the blast, which killed over 50 people, but a Customs official said trade resumed but only for a limited amount of time.
Only 10 trucks from Pakistan crossed the border on Monday, while India did not send any, he said. Normally, around 300 trucks from both countries cross the border during trading hours.
Long queues of trucks were seen all around the Grand Trunk road in Lahore, waiting for trade to reopen.
The business community once again asserted the need to develop a joint mechanism from traders on both sides to counter such acts, which would ultimately affect bilateral trade.
“This is the time that private sectors of both sides need to come forward and build a mechanism that protects bilateral trade,” said Lahore Chamber of Commerce and Industry (LCCI) President Ejaz Mumtaz.
Pakistan’s economy is going to be the ultimate loser when such acts of terrorism occur, said Mumtaz. Traders from both sides have matured many deals but the suspension has once again added to the worries, he said.
Pak-India bilateral trade is the key to enhancing trading activities in the South Asian region, as both countries account for around 90% of the regional Gross Domestic Product. Experts believe that the nature of relations between Pakistan and India is the biggest hurdle in making this region the engine of global economy.
They said that trade and other issues should be dealt with separately and nothing should disrupt business activities.
The current bilateral trade volume is around $2.4 billion and studies have termed it very low in comparison to its potential. Research reports also said that the trade volume between $10-15 billion would be powerful enough to outweigh geostrategic concerns.
“If we want to compete with the world, then we have to act accordingly”, said Saarc President Iftikhar Malik. This terrorist attack might hurt trading activities but the chambers are meant to counter this and we will do our best to normalise the situation, he added.
He further said that this is the responsibility of the state to protect the overall business environment as one single terrorist activity hurts investors’ confidence and can derail the country’s economy.
Positive reactions emerge
The condemnation from the Indian premier is also a positive signal for trade normalisation, according to some traders. They also said that business continued despite the tension at the Line of Control.
“This is an internal issue of terrorism, whereas trade is a totally separate matter,” said former finance minister Dr Salman Shah. “Bilateral trade might get hurt but this period of uncertainty will be short.”
Country to country disagreement on trade is unlikely to happen due to this blast. “Trade will go on; however the security checking of trucks will be tightened as many of them also arrive from Afghanistan”, Shah added.
Published in The Express Tribune, November 4th, 2014.
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COMMENTS (6)
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@Bewildered: The reason is that its always healthy to know what your neighbors are up to, especially when one has a state like Pakistan ! Nothing personal, but if you throw a stone in water it splashes and create a ripple effects too !
@Hedgefunder:
"Forget about trade, as its really insignificant in terms of overall picture from Indian point of view."
@Gp65:
"No doubt India will focus on Bangladesh, which is a willing partner in trade as compared to Pakistan..."
The intelligent then would be focusing on Bangladesh instead of wasting precious time on a Pakistani media site.
Pak -India has 90% of GDP of SAARC - stated as though both countries are more or less equal. In any case th 90% number is not acurate but perhaps 80% would be, It would be equally true to say that Banladesh - India GDP is approx. 80% of SAARC GDP,
No doubt India will focus on Bangladesh, which is a willing partner in trade as compared to Pakistan which thinks it is doing a big favour to India if it allows trade.
Forget about trade, as its really insignificant in terms of overall picture from Indian point of view, however Pakistan should focus on its internal crises and deal with multiple issues staring in its face, in order to improve quality of life of its growing population. I don't hear India begging for MFN status from Pakistan. This should show as to importance of trade with Pakistan.
bangladesh GDP stands at 160-170bn$,will surpass pakistan in next 6 years....where as pakistan's GDP is at 230bn$ will have to grow at at least 6% to stay ahead of bangladesh which is not happening anytime soon...i want to meet the genius who came up with this statement " both countries account for around 90% of the regional Gross Domestic Product"
Trade between India and Bangladesh was $6.6 billion during 2013-14 and is expected to cross $10 billion by 2018. Long way to go for Pakistan- India.