Planners must focus on CPEC

LAHORE: Planners in Pakistan should not be alarmed by India’s all out economic offensive, because squeezing Pakistan economically has always been the covert policy of India, and now it was doing so overtly. 

India violated the Indus River Basin Treaty by constructing Kishanganga Hydroelectric Plant over River Jhelum. It constructed a dam over river Chenab. Earlier, India was open to negotiations on such violations of the Indus Basin Treaty; however, it has stopped even those negotiations.

They have erected numerous non-tariffs, technical and tariff barriers for imports from Pakistan but in bilateral talks always assured that these barriers would be removed. Now they were not on talking terms with us so the barriers would remain.

They have practically denied almost the entire India market to Pakistan. The Indians are fully aware of the danger of war with Pakistan.

Any full scale war would be destructive for both countries but the Indians stakes were much higher as they aim to attain the status of the third largest global economy. War with Pakistan would devastate the Indian economy.

As far as Pakistan was concerned its economy was still in low growth phase, and war would not have much impact on its economy. This would be because Pakistan’s economy has factored in the impacts of terrorist attacks, and reluctance of foreigners to come to Pakistan.

In case the war hysteria created by Indian results in actual war, the foreign investors would stop coming to India as well.

The focus of economic planners and the ruling elite should be on the economy only. The defence of the country should be left to the armed forces that were competent to thwart any aggression. Diplomatic front should be handled by the foreign office and ministers of state.

The China Pakistan Economic Corridor (CPEC) was important for economic growth in Pakistan. All efforts should be directed to complete this corridor on time.

Aggressive posture of Indians would subside once the containers from China start arriving at Gwadar port for onward shipments to developed economies. Indian planners want to target the economic stability of Pakistan, particularly the rapid completion of the CPEC corridor.

A look at the economic policies of India during the past decade reveals that its planners have systematically cornered Pakistan through sweat talk on bilateral trade, and cultural integration without providing a single Pakistan specific concession. Pakistan on the other hand went on accommodating the Indians in many sectors.

We allowed duty free import of heavily subsidised Indian vegetables into Pakistan that marginalised our farmers. Indians on the other hand have slapped heavy duties on import of all agricultural products.

In textiles, Pakistan allowed import of cotton and manmade yarn from India at zero duty; the Indians on the other hand allowed import of Pakistani yarn at 25 percent import duty.

This 25 percent duty on yarn was the MFN duty, applicable on all countries. Around 90 percent of the global yarn was being produced by three countries India, Pakistan, and China.

The Chinese do not export yarn so the duty was practically imposed on Pakistani yarn. One wonders as to why Pakistan could not increase duty on yarn imports to 25 percent in line with India.  Indian media and leaders were asking the Indian government to withdraw SAFTA concessions to Pakistan. We should welcome the move, as these concessions were already covertly withdrawn.

The export from Pakistan to India was meagre. The hawks in India also want to move WTO over Pakistan not extending MFN benefits. They neglect the fact that had this move been possible; Indians would not have waited for 20 years to lodge a complaint with WTO.