Is the light at the end of the tunnel an Indian one? Trade talks which had been expected to yield little or nothing are now shaping up to be the biggest step forward since the Mumbai incident. Pakistan is apparently mulling granting MFN status to India. It was a long time coming, India granted the status to Pakistan in 1995 as part of its WTO obligations.
Talks are also presenting a scenario in which petroleum products from India and Pakistani cement alongside chemicals will pass borders without any restriction. This may not be quantum leap, but is certainly progress in the right direction. Meaningful trade will hopefully generate greater economic activity to bolster our staggering economy. It will also induce greater competitiveness in both countries. Regional trading blocs such as ASEAN and the EU have played a key role in unlocking complimentary strengths in individual economies and there is no reason to assume South Asia cannot replicate the process.
If Indian petrol products are indeed imported, energy costs in Pakistan will be reduced. On the other hand, as India embarks on a massive infrastructure drive, Pakistani cement firms are well poised to plug in any supply gap. The principle of comparative advantage determines that nations stand to gain if they develop core efficiencies in certain sectors and import those products which are relatively cheaper aboard.
Some may doubt the utility of trade talks given the seemingly insurmountable gulf between the two rivals from birth. But as the EU has shown, commercial links can be vital to healing the scars of conflict. As a result of trade, the world’s greatest war has been paved over; today, the stoutest alliance in the EU is between France and Germany who had been at daggers drawn for centuries. Can we look past decades of intermittent conflict and move towards rapprochement through trade? While the fog of war permeates all interaction between the neighbours, the politicians must learn to overcome the barriers within hearts. Politics need not be the continuation of war by other means.
