Pakistan ready to trade, India cautious

Recently, newly-appointed Pakistani Foreign Minister Mohammad Ishaq Dar suggested that his country should resume its trade with India that it suspended in August 2019 following Delhi’s revocation of Article 370 for Kashmir. Pakistan will “seriously examine” whether to restart trade with India, he said.

| Updated: 29 May, 2024 6:27 pm IST

NEW DELHI: Recently, newly-appointed Pakistani Foreign Minister Mohammad Ishaq Dar suggested that his country should resume its trade with India that it suspended in August 2019 following Delhi’s revocation of Article 370 for Kashmir. Pakistan will “seriously examine” whether to restart trade with India, he said.

Meanwhile, visiting Singapore, External Affairs Minister S. Jaishankar hit out at Pakistan for its “industry-level” support to terrorism, stressing that any talks with Pakistan would need to “face up to the problem”.  He added that in India, the “mood is not to overlook” the issue of terrorism. He declined to specifically comment on Dar’s remarks to reporters.

This has come at a time when on one side, Pakistan is embroiled in the worst economic crisis in the history of Pakistan in nearly 50 years and on the other side, India is holding its long awaited general elections.

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Pakistan’s economy has been witnessing extremely high inflation and dismal economic growth for more than two years due to rising energy costs. Consumer inflation has been above 20% since May 2022, and touched 38% in May 2023, the highest rate in South Asia, as per newspaper reports.

Violent street protests in Pakistan occupied Jammu & Kashmir (PoJK) erupted in the month of May, after about 70 members of the Joint Awami Action Committee, an organisation led by traders in the region, were arrested during a strike to protest the rising costs of food, fuel, and utilities. Pakistan’s economic crisis and high inflation have resulted in hardships for its people, and a section of traders have been additionally hit by the stopping of trade with India.

Andrew Korybko, a political analyst, and journalist is of the view that Dar is bluffing. Pakistan’s real motive might actually be to create a public spectacle over this issue that it could then exploit in advance of ulterior goals. He says, “Dar’s seemingly random suggestion raises questions about Pakistan’s intentions, especially since he didn’t float any possible compromises that it could make with India, let alone any unilateral concessions.”

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He adds, “Although his Indian counterpart, S. Jaishankar, reaffirmed that he wants to see a stable neighborhood, thus implying that this could be achieved through the resumption of direct trade, his country doesn’t need to agree to this without Islamabad making some concessions since the latter’s IMF aid suffices for now.” Thus, Korybko reaffirms India’s stance of no negotiation on trade with Pakistan without its commitment around terrorism.

Commenting on Pakistan’s greater need for resuming trade with India, he also states, “The fact of the matter is that Pakistan needs India more than the inverse in order to reduce indirect import costs of its products and thus help liberate itself from the IMF’s bondage over the long term.”

Mosharraf Zaidi, a Pakistani political analyst and an ex-Policy Advisor to the Ministry of Foreign Affairs is of the view that all talks of trade with India among elites of Pakistan are “thoughtless, brainless, evidence-less, kind of rushing through something that does not exist”. “There’s no hand of friendship in New Delhi”, he adds, while addressing the question in a podcast.

When asked about Dar’s statement and its questionable timing due to the economic crisis and India having an upper-hand due to its booming economy, if negotiations take place, Zaidi enthusiastically says, “If there’s a willing partner in India, then there is no wrong time.”

With a word of caution, he added, “If tomorrow, there’s verifiable evidence of absence of hatred for Pakistan in the political elites of India and its willingness to engage in a fair conversation about trade, we shouldn’t spend a second thinking about it.”

Declaring his own position on the trade talks, he says, “Trade, cross-border movement, education, technology, business, banking, and finance — open it all”. He also warns Pakistan that it should learn from its own trade experience with other nations like China and foremost, be prepared.

Speaking to an Indian newspaper, the Amritsar-based Director of the Confederation of International Chamber of Commerce and Industry “welcomed” Mr. Dar’s initiatives for discussions on restarting trade and said the suspension had left the Integrated Check Point at Attari built at considerable investment “idle”.

“India had highly invested in building the most modern land port here in 2012 fully equipped with all facilities that handled about 200 trucks a day,” businessman Ashok Sethi told the newspaper, “We strongly urge the Indian government to react with positive intent as normal economic activity would be mutually beneficial to both the nations,” he added, estimating that thousands of crores had been lost in the past five year.

Considering the politically sensitive time of election in India, trade with Pakistan seems to be a non-issue. No political party, especially in Territory of J&K have made a comment regarding Dar’s statement.

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