Pakistan-India Trade:

Moving Toward Pakistan-India Trade Normalization: An Overview
period. The essence of this argument is that the private sector is, and will
remain, the main driver of business relations between the two countries,
something that has now been realized by both sides.
I only hope that the U.S. administration will learn a lesson from this
experience. Reconstruction Opportunity Zones (ROZs), which have
been on the drawing board for the last few years, remain unimplemented.
The inability of the United States to move forward with this program
has created serious misgivings among the people of Pakistan. The implementation
of ROZs should be a key policy initiative to support our joint
efforts to build bridges of understanding between our people.
In the early 1960s, Pakistan’s second five-year plan enabled its
economy to grow at a fast pace. In fact, the World Bank sponsored a
delegation from South Korea to study the growth model of Pakistan.
Back then, Pakistan’s economy was thriving in a rather peaceful region.
It was regionally well connected. But after Pakistan’s war with
India in 1965 and then the Soviet invasion of Afghanistan in 1979,
everything changed.
Our government has declared 2012 as the “year of regional trade
and connectivity.” We hope that the situation in Afghanistan stabilizes,
and opens up new opportunities for Pakistan (and India) in Central Asia.
The distance of Kashghar (the capital of Xinjiang province in
China) from Karachi’s port on the Arabian Sea is only 1300 miles. The
distance of Kashghar from the port of Shanghai is twice as far. It makes
economic sense for exports and imports from Kashghar to be routed
through Karachi. Pakistan has an all-weather road link with China,
which has been slightly disrupted due to an earthquake-generated lake
in the Attabad region of Pakistan. However, this is being addressed
through the construction of an alternate route to skirt around the lake.
Pakistan’s trade with India is expected to gain momentum, especially
if there is movement on other bilateral issues holding up an improvement
in political relations. If this happens, the stage will be set for a
well-integrated SAFTA region that would, both economically and commercially,
integrate with the neighboring ASEAN region. For Pakistan,
this would be the time to finally take advantage of, rather than suffer
from, its geo-commercial location.
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