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Pakistan-Thailand Relations – A Lasting Friendship

December 15, 2021 at 8:01 am | Economic Affairs

By Sahebzada A. Khan

It is indeed a pleasure to contribute to Monthly Economic Affairs, Pakistan, especially on the 70th Anniversary of establishment of diplomatic relations between the Islamic Republic of Pakistan and the Kingdom of Thailand. The logo of the anniversary was launched on 08 October 2021, to kickstart the celebrations. There are numerous activities being planned in Pakistan and Thailand on this momentous occasion. These activities are an opportunity to celebrate our achievements and identify the opportunities, where we can further synergize to achieve our mutual goals and aspirations.

Thailand and Pakistan are long-trusted friends. Ours is an enduring relationship that was best described by His Majesty Late King Bhumibol Adulyadej The Great, in his address to a State Banquet during the royal visit to Pakistan in March 1962: “The friendship between Pakistan and Thailand has been longstanding and gathers strength through the passing of time. The reason for this is simple. Our two peoples have much in common. They are peaceful by nature.” These words of great wisdom and foresight encapsulate Pak-Thai friendship, that continues to prosper. The current King of Thailand, His Majesty Maha Vajiralongkorn Phra Vajiraklaochaoyuhua, expressed similar sentiments during my royal audience on presentation of credentials, in Bangkok, recently.

Interestingly, the socio-cultural linkages between Pakistan and Thailand can be traced back to ancient times of the Buddhist Gandhara heritage of Pakistan – with Taxila at its heart. Pakistan is home of some of the most prominent and well-known Buddhist heritage sites in the world.

The two strong pillars of our affinity are shared history and culture. History reminds us of our close association, which goes back to the South Asia Treaty Organization (SEATO). The Cold war era also provided an anchor for Pakistan-Thailand relationship, when both countries became close allies. In the post-Cold war period, our two brotherly countries sought to reinforce bilateral relations through deeper cooperation in trade, investment, education, science & technology, security, defence, culture, and tourism.

Interestingly, the socio-cultural linkages between Pakistan and Thailand can be traced back to ancient times of the Buddhist Gandhara heritage of Pakistan – with Taxila at its heart. Pakistan is home of some of the most prominent and well-known Buddhist heritage sites in the world. We have a UNESCO world heritage site located there. Also, another Buddhist world heritage site is located in an area called Gandhara, at “Takht-i-Bahi Monastery”. Precious Buddhist relics, for example the Fasting Buddha image, is well preserved in Lahore Museum. Furthermore, there has been discovery of world’s oldest “Sleeping Buddha” statue, near the Bhamala Stupa in Haripur District

Pakistan is promoting Buddhist tourism among Thai tourists. We attach high priority to deepening people-to-people contacts through greater cultural projection and increased two-way tourism. Apart from the religious tourism, we are also focussing on tourism from Thailand to our mountainous regions in the north, known for their breath-taking beauty and scenic landscapes,

To commemorate our 70 years of friendship, the Embassy of Pakistan of Pakistan in Bangkok is organizing the following events;

  • A ‘Pakistan-Thailand Friendship Week is being held by organizing seminars and related activities highlighting our cultural linkages, involving joint performances by Pakistani and Thai artists
    • Issuance of joint commemorative stamps, signifying the theme of ‘Buddhist World Heritage
    • Reciprocal naming of a major road or avenue in our two capitals, to honour our leaders – Quaid-i-Azam Muhammad Ali Jinnah and His Majesty King Bhumibol Adelyadej, The Great. The centrepiece would be the “Gandhara Exhibition,” at National Museum Bangkok, focussing on the Buddhist heritage of Pakistan and influence of the Gandhara art in Thailand. This exhibition would highlight the common heritage, so carefully preserved in Taxila, Takht-i-Bahi, Peshawar and elsewhere in Pakistan. Preparations are underway for sending over hundred original artifacts from Pakistan to Thailand

The Pakistani and Pakistani-origin community, comprising around 8,000 and 250,000, respectively, are expected to take active part in these celebrations, including a cross-section of the Thai civil society. I would also like to mention that generations of Thais of Pakistani origin, contributed to the Thai economy and have seamlessly integrated and thrived in Thailand.

Pakistan is promoting Buddhist tourism among Thai tourists. We attach high priority to deepening people-to-people contacts through greater cultural projection and increased two-way tourism.

Current policies of both countries recognize each other’s importance and the potential of forging a closer partnership. Thailand’s “Look West” policy complements Pakistan’s “Vision East Asia” policy. Pakistan has made a policy shift from geopolitics to geo-economics. Geo-economics is the guiding force in Pakistan’s vision of development centred on connectivity, partnerships, and a peaceful neighbourhood.

Pakistan seeks to leverage its geo-economic location to promote connectivity and act as an economic, trade and transit hubs. As part of our development strategy, we are offering economic hubs to partners. The China Pakistan Economic Corridor (CPEC) is the prime manifestation of the development through connectivity paradigm. We see a similar approach in Thailand’s Eastern Economic Corridor (EEC) and other connectivity projects. This has enormous potential for our bilateral cooperation.

Let us shift gears to our bilateral economic relations. While our bilateral trade has grown steadily in recent years, reaching an all-time high of US$ 1.68 billion in 2018. This figure, however, does not commensurate our business potential. This upward trajectory was, unfortunately, interrupted in 2020, due to Covid-19. I am, however, pleased to note that our bilateral trade is back on track, as during 2021, there has been a quantum jump of over 80 percent, in our bilateral trade, compared to 2020. Interestingly, the Pakistani public and private sectors are very keen to participate in the forthcoming trade related events in Thailand: (1) Thaifex-Anuga Asia- 22, (2) Style Bangkok 2022, and (3) Bangkok Gems and Jewellery Show- 2022. Both countries are also actively engaged in negotiating to finalize a mutually beneficial ‘Free Trade Agreement (FTA),’ termed as “Pakistan-Thailand Free Trade Agreement (PATHFTA)”. Pakistan and Thailand are also preparing for the 3rd “Ministerial level Joint Economic Commission”, at the earliest opportunity.

Pakistan is the second largest trading partner of Thailand in the South Asian region. Both countries have significant trade interdependencies and following a positive bilateral trade trajectory, over the last many years, apart from year 2020.

Pakistan is the second largest trading partner of Thailand in the South Asian region. Both countries have significant trade interdependencies and following a positive bilateral trade trajectory, over the last many years, apart from year 2020. Pakistan and Thailand also share the distinguishing advantage of strategic geographic locations in their respective regions.

Thailand has a competitive advantage in major industrial production sectors, agriculture, food processing and construction. It has undergone a monumental industrial and social transformation amid rapid economic growth and development for over half a century. It is now the second largest economy with fourth highest income per capita in the ASEAN region. It has successfully shifted its economy from agriculture to export oriented manufacturing, while integrating key production sectors, particularly automobiles and electronics, into regional value chains.

Thailand has also been successful in attracting foreign direct investment, particularly in export-oriented sectors. The industry contributes to 36% of Thailand’s GDP. Looking ahead, Thailand has already entered the next phase of development under “Thailand 4.0” plan focusing on innovation, technology, sustainable economic growth, and social development. Currently, Thailand has moved up to upper middle-income country, by a structural transformation. This reform program encompasses areas called “S-curve innovative sectors”, which includes high-tech automation, robotics, aerospace, bioenergy, and bio-chemicals, digital and medical and healthcare, SME promotion, state-owned enterprises, infrastructure, and digital economy.

Government of Pakistan is also treading a similar path, ushering into a new era of infrastructure development, investments in energy sector, industrialization, modernization of agriculture and IT revolution, based upon the economic game-changer of ‘China Pakistan Economic Corridor (CPEC)’. Pakistan has traditional strengths in various sectors like textiles, leather, surgical and sports goods, agro-based products and cement and sugar industries. We are gaining rising strengths in light engineering, IT, software and defence production sectors. Both the countries can benefit in future industrial and sectoral cooperation in the areas of their respective strengths.

Despite facing the economic and trade related challenges posed by the pandemic, it is heartening that our bilateral trade has rebounded with a quantum leap. The total volume of bilateral trade between Pakistan and Thailand in Jan-Sep. of year 2021 has been recorded as US$ 1,314 million, showing an increase of 80.15% over the same period of last year. Thailand’s exports to Pakistan amounting to US$ 1,171 million have increased by 85.39%, while Pakistan’s exports to Thailand amounting to US$ 143 million have increased by 46.44% over the exports of last year during the same period. This positive trajectory of bilateral growth is far above the Thailand’s global trade growth of 23% and exports growth rate of 15%. (Figure in US$ million)

Trade20202021% Change
(Jan.-Sep.)(Jan.-Sep.)
Pak Exports98.02143.54+ 46.44
Pak Imports631.671,171.03+ 85.39
Total Trade729.691,314.56+ 80.15

The major exports of Pakistan to Thailand constitute fish/seafood (65%), textile products (9%), garments (5%), ethanol (4.8%), surgical goods (2%), minerals (2%), chemicals, fruit concentrate, rice, and sports goods. While Thailand’smajor exports to Pakistan constitute automobile parts (22%), chemical products (11%), synthetic filament (8 %), polymers of ethylene & propylene (7.5 %), rubber products (5%), auto engines (5%), machinery/parts, yarn, electrical switching apparatus, ginger, and maize seeds.

The total volume of bilateral trade between Pakistan and Thailand in Jan-Sep. of year 2021 has been recorded as US$ 1,314 million, showing an increase of 80.15% over the same period of last year.

Thai companies have also expressed keen interest in investments in Pakistan and many have been materialized. Amongst the major investments, the Thai food giant “Charoen Pokphand-CP Group” has a strong presence in Pakistan, where they have invested in the poultry sector. In the recent past, “DAIDO Kogyo Company., Ltd, Thailand” entered into a joint venture with “Atlas Autos (Private)., Ltd, Pakistan” to manufacture motorcycle chains in Pakistan.

I am happy to inform that that during 2021, Pakistan received investment in a relatively new sector of ‘aqua-feed manufacturing’, from a very significant Thai company i.e., “Thai Union Group Public Company., Ltd,

The establishment of ‘Special Economic Zones (SEZs)’, investment facilitation and incentives by Pakistan are playing a pivotal role in attraction of new investments. In a study conducted in 2019 by the BOI-Thailand, Pakistan has been identified as having huge potential for investments for Thai companies in auto sector, food processing, fisheries, and tourism sectors.

The writer is ambassador of Pakistan to Thailand

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