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Thursday March 28, 2024

Traders urged to exploit SAARC trade potential

LAHORE: The government and businessmen should exploit trade potential in the South Asian Association for Regional Cooperation (SAARC) nations instead of focusing on India alone, as for the last 20 years, the exercise to enhance trade with the neighbouring country has proved futile, experts said on Saturday. Financial analyst Muhammad

By Mansoor Ahmad
August 23, 2015
LAHORE: The government and businessmen should exploit trade potential in the South Asian Association for Regional Cooperation (SAARC) nations instead of focusing on India alone, as for the last 20 years, the exercise to enhance trade with the neighbouring country has proved futile, experts said on Saturday.
Financial analyst Muhammad Mubashar Bashir said the government and the businessmen concentrate on trade with India and neglect other SAARC countries, including Bangladesh, Sri Lanka, Maldives and Nepal.
“India, on the other hand, keeps Pakistan engaged in trade talks that it can break off at will,” he said, “At the same time Indian trade negotiators, its private sector and its political leadership vigorously explore the markets in other SAARC countries.”
A visit to Sri Lanka or Bangladesh shows that their markets are flooded with Indian goods from automobiles to home appliance and from industrial raw material to daily use grocery items.
“Pakistani products are not found even sporadically in these markets,” he added.
Pakistani businessmen eyeing 1.4 billion Indian markets have not given importance to these small markets. The combined population of Sri Lanka and Bangladesh is more than the population of Pakistan. “By targeting the markets of these two countries Pakistani businessmen can double their market reach,” the analyst observed.
While the Indian Prime Minister Modi visited these SAARC countries to gain market access for Indian businessmen there have been no such move from the Pakistani government. The analyst urged the government and the private sector to plan their business strategies based on penetrating these SAARC markets.
Former president Lahore Chamber of Commerce and Industry Farooq Iftikhar said, “Trade with India is a mirage as Indians continue to create technical hurdles ensuring that nothing from Pakistan penetrates the Indian market with ease.”
There are many products that did manage to enter the Indian markets and their acceptance give businessmen the hope that if minor non-tariff hurdles are removed they will have access to a huge consuming population across the border.
He said Indian negotiators engage with private sector and Pakistani officials and concede that the hurdles are unfair and assure that they would remove these barriers to trade, adding that the practice is going on for more than a decade but no barriers have been removed so far.
Cement manufacturers have to get quality certification from Indian experts and the procedure to obtain that certificate takes six months and is granted for one year only. Moreover, the renewal process starts after expiry of earlier certification which again takes six months.
“In the meantime, the mill cannot export to India,” Iftikhar said.
Moreover, exporting cement through railway wagons has been effectively banned. Only a few cement loaded trucks are cleared by the Indian customs at Wagah border. However, hundreds of trucks loaded with cement raw materials, which are available abundantly in Pakistan, are cleared promptly by the custom authorities.
A textile entrepreneur Mian Muzzafar Ali said the Indian designs about Pakistan could be judged easily by its deeds.
In 1965, Pakistani industry was totally dependent on Indian raw materials. At the start of September 1965 Indo-Pak war India blocked all supplies to Pakistan resulting in closure of many industries as Pakistani entrepreneurs searched for alternate raw material supplies from Far East.
Furthermore, India gave Pakistan MFN status in 1996. The trade started improving at that time but in 1999 many Indian suppliers refused to ship goods to Pakistan because of Kargil war. Similarly, when the global cotton prices hiked, the Indians against all global norms refused to honour the confirmed orders of cotton. Again, when Bombay killings occurred, India suspended trade and cultural ties with Pakistan.
However, Pakistani governments continue to express their will to engage Indians in dialogue.
The entrepreneur further said India has now again suspended foreign ministers’ dialogue because Pakistani foreign minister is scheduled to meet leadership of Indian held Kashmir, labelling it as a routine matter by the Indian authorities.
He said Pakistani planners fail to realize that all duties levied by India on all possible imports from Pakistan are lopsided.