Trade promotion best solution to minimise tensions: Indian envoy

Growing Indian economy can help boost opportunities for Pakistan.

KARACHI: Promotion of trade is the only way to minimise political tension in the region so India and Pakistan should not mix trade with politics and the business community should be allowed to carry on trade without hurdles, according to the Indian High Commissioner, Sharat Sabharwal.

Sabharwal was speaking at the Lahore Chamber of Commerce and Industry (LCCI) on Monday. “If we have strong trade relations, political relations would get better automatically,” he said.

He stressed the need for promoting border trade particularly through land routes which is in favour of both the countries. He said that as the fastest growing economy of the region, India has the potential to become a growth opportunity for all its neighbours, including Pakistan.

The high commissioner said that the Indian economy is likely to attain an annual growth rate of nine per cent in coming years, adding even as India progresses on the path of high growth and rapid development, it regards the prosperity of the rest of South Asia in its own interest.

He said that India had met its commitments under the South Asia Free Trade Agreement by drawing up a sensitive list, beyond which all items can be imported from Pakistan and other member countries of the South Asian Association for Regional Cooperation (Saarc).

However, he said, Pakistan continues to maintain a positive list of less than 2,000 items and the import of all the remaining items from India stood banned. He expressed hope that this situation will change in the interest of expanded trade relations between the two countries.

Referring to non-tariff barriers in India, the high commissioner said that the reference appears to be related to requirements of technical standard certification, standard of quality, sanitary and health regulations. He clarified that such specifications apply to all trading partners of India and are not Pakistan-specific.

He said that potential gains from increased economic integration between India and Pakistan are large whereas mutual trade between the two countries is unnaturally small. Further efforts to facilitate and increase trade can become an effective tool to ease out the tense relations.

Informal trade, via third countries (such as the United Arab Emirates, specifically Dubai), is estimated at some $2 to $3 billion per year, and this trade could obviously be undertaken bilaterally at a significantly lower cost, he added.

Published in The Express Tribune, November 23^rd, 2010.