September 5, 2012
If, in the context of Indo-Pak relations, some years are to be remembered for wars and for terrorist attacks, surely 2012 will be remembered for trade diplomacy. This year has seen significant and unprecedented developments in bilateral trade and investment between the two countries. And, with several months still remaining, there remains much to be hopeful for.
India has overturned a long-standing ban on foreign investment from Pakistan in all sectors except space, defense, and atomic energy. This decision represents a significant step in improving relations between the two nuclear-powered neighbours. Bilateral investment binds the long-term economic interests of countries to each other, and is a strong deterrent against war.
In July, Mian Muhammad Mansha, the Chairman of Muslim Commercial Bank (MCB) made headlines across Pakistan and India by submitting a proposal to open up at least three branches of MCB in Delhi, Mumbai, and Amritsar. The acceptance of this proposal is historic in the context of Indo-Pak trade relations, and will greatly facilitate bilateral trade and investment between the two countries. Experts have long argued that opening up Pakistani banks in India and vice versa is imperative to trade.
“I have always been a strong proponent of trade with India, which offers a bigger opportunity than China,” says Mansha, Pakistan’s most eminent businessman and an outspoken advocate of increased trade between Pakistan and India. India and Pakistan, he argues, are natural trading partners with many synergies.
Mian Mansha was a speaker at Dividends, the Second Aman ki Asha Indo-Pak Economic Conference in Lahore in May 2012, and hosted many top businessmen from both countries at his farm house in Raiwind.
Dividends itself was a watershed event in the context of Indo-Pak trade relations. The conference was held in collaboration with Confederation of Indian Industry (CII), and the Pakistan Business Council (PBC) representing powerful business interests in the two countries.The most prominent members of the business community, academics and leaders of thought in Pakistan and India came together at the conference to discuss modes of increasing trade and investment. The Chief Guest of the conference, then Prime Minister, Syed Yusuf Raza Gilani, strongly endorsed Aman ki Asha, and said that he could state with confidence that both his, and the government of Manmohan Singh, were sincerely committed to the normalization of trade relations between India and Pakistan.
In April, LifeStyle Pakistan took Delhi by storm, with over 600 businessmen from Pakistan traveling to India to participate in the hugely successful expo, held over two days in Pragati Maidan. The Pakistani delegation comprised the Commerce Minister, Makhdoom Amin Fahim, Secretary Commerce Zafar Mahmood, Trade Development Authority of Pakistan (TDAP) CEO Tariq Puri, and prominent businessmen, including Mian Muhammad Mansha and Bashir Ali Mohammad.
Pakistan Commerce Minister, Makhdoom Amin Fahim and his Indian counterpart, Anand Sharma, inaugurated the first integrated check-post between Pakistan and India at the Wagah–Attari border. The check-post aims to facilitate trade between the two countries and allow for quicker custom clearance.
Last November, Pakistan agreed to grant India Most Favoured Nation status, which ended restrictions required for most products to move via a third country. Pakistan has committed to end the negative list of 1,209 items by the end of 2012.
All these policy decisions, conferences and logistical events signal greater economic engagement between Pakistan and India, ushering in an era of trade diplomacy. Its ambassadors are the businessmen and women of both countries, who argue that trade must not be held hostage to political issues.
Indeed, the warming relations between the two countries suggest that improved bilateral trade and investment and the mutuality of economic interest will help pave the road to peace.Here’s hoping that the governments stay the course.
Laleh Habib, former Coordinator, Aman ki Asha, has a Masters Degree in Politics and Communication from the London School of Economics.