Money Matters

Back to reality

Money Matters
By Zeeshan Haider
Mon, 07, 19

Prime Minister Imran Khan looked very jubilant when last week he returned from what is officially described as a highly successful visit of the United States

Prime Minister Imran Khan looked very jubilant when last week he returned from what is officially described as a highly successful visit of the United States

According to the Foreign Office, the three-day visit reset the ties between the two countries which have literally been frozen over the past several years.

Though neither any agreement was signed nor any public commitment was made, the visit was considered a big PR win for the prime minister who just at the start of the year locked in verbal sparring with the US president on twitter.

During their meetings behind closed doors, the two leaders as well as their aides discussed a range of issues, including military cooperation, Afghan conflict, Pakistan’s ties with India, Kashmir problem etc.

But during their interaction with the press before their official parleys, the US president underlined the need for strong commercial ties between the United States and Pakistan.

The United States has been the top trading partner of Pakistan for the past many years, but the bilateral trade is way short of the true potential the two countries have.

Trump emphasised that increasing bilateral trade should be one of the priorities.

“And we (the United States) just came out, Mr Prime Minister, with tremendous economic numbers for the United States — the best we’ve ever had. We’ve got the best economy we’ve ever had. And I think we can shift some of that over to Pakistan. We should be doing tremendous business together. So, I look forward to it,” Trump said during the pre-talk.

Traditionally, Pakistan’s relations with the United States have been focused on military-to-military cooperation and since the late 1970s these were mainly focused on their cooperation on the Afghan issue.

Throughout this period, Pakistan has been the recipient of the US aid in return for its cooperation in Afghanistan.

After 9/11 when Pakistan became a key ally of the United States in its war on al Qaeda, the two countries entered into an understanding that the United States would reimburse the money to Pakistan for the damage inflicted on its infrastructure under the Coalition Support Fund (CSF).

According to Pakistani calculations, the United States still owes $9 billion to it under the CSF.

However, given the economic and financial crunch Pakistan faces, it needs favourable access to the US market for its goods.

Trump has admitted that Pakistan holds the key in resolving the Afghan conflict and his administration is pressing Pakistan to bring Taliban to the negotiating table.

It is because of Pakistan’s efforts that the Taliban met face-to-face with the US envoy on Afghanistan Zalmay Khalilzad, and now efforts are underway for direct meetings between the representatives of the Afghan government and the Taliban.

Pakistan needs to cash on its pivotal position and convince the United States to provide its goods favourable access to the US markets.

But this could only be done if Pakistan makes its goods competitive, as in the world of competition there is no such thing as a free lunch.

“…..we do very little trade with Pakistan compared to what we could be doing and should be doing when our countries really get along perfectly. And I think we’re having that start. We’re going to have that start,” Trump said

He emphasised that the two countries have the potential to grow their trade up to 20-fold.

“I see great trade with Pakistan. And I’m not — I’m not talking about a little bit more. I’m talking about — we could go 10 and even 20 times what we’re doing right now,” he said, adding, “Pakistan is a big country. It’s actually a very big country, and they have tremendous product. They make great product. They make tremendous — I’ve bought from Pakistan over the years when I was in the private sector. They make incredible product. They’re brilliant people. They’re hardworking people.”

After such tremendous goodwill, it is for the Pakistani government and the entrepreneurs to turn this goodwill into a reality.

Pakistan needs to follow-up the prime minister’s visit with more interaction between the commerce officials of the two countries as well as businessmen of the two countries to explore avenues where joint ventures as well as investments could be made.

There is a huge Pakistani diaspora in the United States and much of it constitutes Imran Khan’s supporters, as was evident from the big public rally held in Washington DC.

The influential Pakistanis could be used as a vehicle to reach out to the US businessmen to persuade them to make their investment in Pakistan, as security has improved tremendously in the wake of a string of military operations against militants in the northwest bordering Afghanistan as well as elsewhere.

Prime Minister Imran Khan seems to have been able to develop a good personal rapport with Trump. Since Trump is a business-minded person who has experience of working with Pakistani businessmen, it needs to be exploited to reap maximum benefits.

Time has come not only to reset the bilateral ties but also to widen the scope to include major areas of mutual benefit. The level should be maximised and both trade and investment should be encouraged to benefit Pakistan.

The prime minister had a slew of meetings with the businessmen, though most of them were with the Pakistani-origin entrepreneurs. Of course, Pakistani-origin businessmen should be given priority but efforts should be made to lure other businessmen as well.

During the visit, efforts should also have been made to urge Pakistanis to send maximum remittances to their homeland. Remittances are one of the major sources of foreign exchange for the country.

Increased remittances from overseas Pakistanis would ease pressure on foreign exchange reserves, much of which are made up of borrowed money from international financial agencies and wealthy friendly countries.

The first US visit by Imran Khan as prime minister should now be used as a springboard to explore more areas in order to meet the daunting challenges faced by the country on the economic front. The PR exercise win should to be turned into a concrete and a solid effort to meet the challenges.

The writer is a senior journalist based in Islamabad