Front Page

Dream come true, say Pakistani businessmen

ISLAMABAD: The decision to open the Wagah-Atari border and the Munabao-Khokrapar rail link to trade is a “dream come true” but the two sides will have to work fast to implement it and put up the additional infrastructure it will require, says Pakistan’s business community .

The Wagah-Atari border has been closed to normal traffic of people and goods since the 1965 India-Pakistan war. Earlier this week, Pakistan President Asif Ali Zardari and Prime Minister Manmohan Singh agreed to open the two crossings for trade during their talks in New York.

In recent years, the gates, where India and Pakistan stage a theatrical display of lowering their respective flags daily at sundown, have opened a crack to permit trade in a handful of items in the already restrictive trade between the two countries.

At present, Pakistan imports tomatoes, potatoes and onions from India through the crossing, while the major item of Indian import is cement. In October 2007, the two governments took the step, bold by previous standards, of allowing trucks carrying these goods to cross over into the other side, instead of unloading on their side, and then manually carrying the goods into trucks on the other side.

Both Pakistani and Indian businessmen have been demanding that the border should be used more effectively for trade, but Islamabad had so far resisted it, holding that such steps towards normalisation were impossible until the issue of Kashmir was resolved.

The recently inaugurated Munabao-Khokrapar rail link connects Sindh with Rajasthan and Gujarat, but has been restricted only to passengers.

“[The opening of these routes to trade] is a much awaited and long-standing demand of the business community. It will help trade to flourish between the two countries. This border, which has been such a big symbol of conflict between us, can now be turned into a symbol of peace through economic relations,” said Mohammed Iqbal Tabish, secretary-general of the Pakistan chapter of the SAARC Chambers of Commerce and Industry.

Pakistan’s trade regime with India is still based on a restrictive positive list of 2000 importable items, but Mr. Tabish said the business community foresees “a new era of economic co-operation between the two countries.”

“The need of the hour is to focus on trade in order to offset the political tensions. Now trade diplomacy can replace the political diplomacy,” he said.

The PPP-led government’s emphasis on driving India-Pakistan relations through trade has already led to an expansion in the positive list, taking it up to its present number. In its new annual trade policy for 2008, Pakistan has allowed the import of CNG buses from India, and would also like Indian manufacturers to invest in making these buses in this country.

The opening of the land crossing and the rail link is expected to greatly help industrialists in Punjab and Sindh who as it provides a faster of way of bringing in machinery and raw materials. At the moment, these have to be first freighted to Bombay, and then shipped to Karachi from where they have to be transported to their final destinations in Pakistan.

Businessmen here said doing trade across the land routes would simplify matters for them, leading also to reduction in manufacturing costs and delivery time for export products.

“This is every businessman’s dream come true,” said Waqar Ahmed Shaikh, a consultant on trade with India, who has taken trade delegations to India for exploring business opportunities.

The decision, he said, would benefit the textile and sugar industries in Punjab as manufacturers could bring in machinery. Raw cotton was allowed into Pakistan through the route earlier this year.

But, Mr. Shaikh cautioned, the road ahead was “full of ifs and buts.”

“It’s only a decision by the leaders, and it has to be notified by the governments. No time-frame has been given as to when it will start,” he said, pointing out that there was hardly any infrastructure to support trade on the border crossings.

“In order to develop the infrastructure, the two governments have to work day and night,” Mr. Shaikh said. He listed cold storage facilities for perishables, quarantine for livestock, warehouses for cement and other raw materials, besides good roads on either side as some of the essential infrastructural needs.

On the Munabao-Khokrapar rail link, the Pakistan government would need to strengthen its tracks to carry freight.