Being a member country of SAARC and ECO, Pakistan needs to effectively promote its trade on the pattern of gravity model by utilising these regional arrangements.
The Pakistan’s new initiative and narrative of geo-economics is facing the most crucial question and daunting task how to tackle geo-politics in best possible way while keeping in view its geographical location.
The Eastern neighbour has a very bad record of human rights violations denying right to self-determination to the people of Kashmir, also holding back plebiscite in Kashmir forcefully held and occupied by them for a long time now. The new Afghan government is yet to be recognised by the international community. The Iran is under sanctions facing a plethora of issues in smooth functioning of its trade and businesses. What could possibly be a smart move to get maximum of its geo-economics facing the ground realities of geo-politics in the region?
Here I would go for the recourse of my own assertions in different articles advocating regional trade integration being part of geo-economics to achieve economic security. There is no denying the fact that economic security has got prime importance in the national security paradigm, as we see all most important developed countries right from United States of America to European countries and now an emerging new power of China, all have strong economies safeguarding their national security interests. It is a proven fact that economic security paradigm has become almost synonym to national security in the world. The geo-economics has a vital role to play in the whole gimmick to strengthen regional trade integration.
The FDI (Foreign Direct Investment) can only be attracted by improving bilateral relations, where comes the role of the big brother first. This is the only way forward to make this great region greater by adopting visionary policies and abandoning hegemonic designs.
Pakistan being a member country of South Asian Association for Regional Cooperation (SAARC) and Economic Cooperation Organization (ECO) needs to effectively promote its trade on the pattern of gravity model by utilising these regional arrangements. But the million-dollar question is how to revive regional trade through SAARC in the absence of visionary leadership in India, although ECO forum can be effectively utilised for trade and economic cooperation by Pakistan.
The SAARC countries have a big consumer market of about 2 billion people with comparatively cheap labour having a huge potential of industrial growth. Need of the hour is to promote trade in the region to change the poor condition of the masses through industrial growth, trade infrastructure and trade promotion attracting more investment in the region.
Right now, the intra-regional trade volume is dismal and disappointing owing to various reasons, which need to be addressed by the major partners by removing all sorts of hurdles and barriers. The intra-regional trade is not picking up more than five percent of the total trade volume of the region and the major reason of such a low trade is mainly attributed to regional disputes, which need to be resolved at the earliest.
The trade promotion in the region is subservient to and dependent upon better bilateral relations of SAARC countries, especially India and Pakistan. The regional trade promotion is a necessity and necessary for South Asia, which can be promoted through South Asia Free Trade Agreement (SAFTA) under the auspices of the SAARC to uplift their economies marred by COVID-19 pandemic for the last almost two years. The cost-cutting measures can only be ensured through regional trade promotion. According to one estimate, the goods and services from the neighbouring countries can be available at half the price we import from the international market.
The FDI (Foreign Direct Investment) can only be attracted by improving bilateral relations, where comes the role of the big brother first. This is the only way forward to make this great region greater by adopting visionary policies and abandoning hegemonic designs. The confidence building measures are immediately needed.
The ten member countries ECO forum is another opportunity for Pakistan to promote trade in West and Central Asia by building concrete solid relations through this regional arrangement. The ECO member states are rich in energy with a hell lot of potential growth and investment opportunities.
Luckily, there are no political issues unlike SAARC and there are no barriers or stumbling blocks involved in trade promotion except Iran suffering from international sanctions. A good thing about the ECO is that it consists of predominantly Muslim-majority countries having a long history of trade and merchandise, as it used to be an integrated agricultural region facilitating trade of goods and services.
The ten member countries ECO forum is another opportunity for Pakistan to promote trade in West and Central Asia by building concrete solid relations through this regional arrangement. The ECO member states are rich in energy with a hell lot of potential growth and investment opportunities.
A lot of economic cooperation is underway by and between Pakistan and ECO countries paving way to economic growth and investment, especially in energy sector. The Iran-Pakistan gas pipeline (IP Gas Pipeline) is one and Turkmenistan-Afghanistan-Pakistan-India gas pipeline (TAPI Gas Pipeline) is another project for close regional and geo-economic cooperation, which would be meeting our energy requirements.
It would have been better if India should not have withdrawn from IP gas pipeline project, as it was initially designed and named as Iran-Pakistan-India (IPI) gas pipeline. The IP gas pipeline is the most feasible project but it is stalled for the time being due to sanctions on Iran hurting regional economic cooperation. Hopefully, the issues of international and American sanctions on Iran would be resolved soon and IP gas pipeline project would be implemented.
The Belt and Road initiative of China is another game changer project integrating different regions of the world. It is basically meant for a close meaningful economic cooperation through viable trade routes by developing a web road infrastructure providing easy mobility of goods and services as part of cost cutting measures.
Pakistan rightly appreciated this initiative and has become a part of Belt and Road project in the form of China-Pakistan Economic Corridor (CPEC) providing opportunity of connectivity to South Asia, West Asia, Middle East and Central Asia. It would be a harbinger of progress and prosperity for the region and for the people of Pakistan.
Development of Special Economic Zones as part of CPEC would bring more investment, which in turn would be providing a greater opportunity to the people of Pakistan. The connected and other regions of the world would also be in a position to utilise and get economic benefits from this economic corridor and trade route.
Pakistan is at a very critical juncture of time and crossroads of history. It needs visionary policies and practical steps to strengthen its position vis-à-vis region through geo-economic regional cooperation, trade promotion and economic integration. The peace and stability in the region can ensure regional cooperation ensuring sustainable economic development, which in turn help supports economic growth and investment in the country. Pakistan needs to focus more on this approach to earn respect, partnership and high place in the comity of nations.
Pakistan is at a very critical juncture of time and crossroads of history. It needs visionary policies and practical steps to strengthen its position vis-à-vis region through geo-economic regional cooperation, trade promotion and economic integration.
The geo-economic narrative needs to be promoted at a fast pace to get best of the results of our economic policy giving prime importance to investment and development in the country. It is a well appreciated paradigm shift of the government to move from geo-political to geo-economic strategy.
There is a need to transform geo-political strategic depth to geo-economic strategic depth. The Pakistan’s geographical confluence at the two biggest economies of the world makes it a big opportunity for future cooperation and economic development. The China is already with us as an iron brother.
But it is really a big challenge to bridge gap between dream and reality so far as India is concerned, especially opting out geo-economic cooperation setting everything aside. It needs a thorough in-depth review of future policy by all the stakeholders and policy makers at all levels.
The writer is a senior civil servant based in lslamabad.
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