Trade with India

Published July 14, 2022
The writer is a political scientist at Tufts University.
The writer is a political scientist at Tufts University.

THE debate over whether or not Pakistan should trade with India has resurfaced in recent weeks, prompted in part by the poor health of the economy, as well as recent suggestions that Pakistan hasn’t quite been able to fully achieve its objectives vis-à-vis the Kashmir dispute by downgrading relations with India.

There is no disputing the economic justification for greater engagement with the neighbourhood, or the logic of geo-economic connectivity, which successive Pakistani governments have advocated for and which has recently found a central place in the country’s National Security Policy document.

But while those in favour of re-establishing Indo-Pak trading say that doing so could usher in economic benefits and foster peace constituencies, they ignore the logic for disengaging with India.

The logic for disengagement was never grounded in economics; it was predicated on India’s unilateral revocation of Article 370 in 2019 which altered the status of India-occupied Jammu & Kashmir (J&K).

Pakistan argued that this violated the Simla Accord. That status remains uncha­nged, as does the suffering of Kashmiris which remains singularly non-partisan in its domestic political appeal across Pakistan.

While there are many examples of adversarial states that manage to engage economically with one another despite their differences (for instance, China and India), the India-Pakistan dispute in its current state simply lacks the structural foundations on which a politically viable trading relationship can be built.

What would viable trade ties be based on?

What would such a foundation look like? To start with, it would need (on either side of the border), a political rationale that is potent enough to attract and sustain democratic and institutional buy-in.

We’ve already seen the consequences of attempts to establish trade in the absence of such a rationale.

Two months ago, the federal cabinet’s approval of a new trade minister in Pakistan’s diplomatic mission in New Delhi was met with uproar, even though the cabinet subsequently clarified that the post had existed for over two decades.

Last year, the ECC saw its decision to import sugar, cotton and cotton yarn from India vetoed by the cabinet in less than 24 hours, even though the price of these commodities was cheaper in India.

During Nawaz Sharif’s third government (2013-17), it was ostensibly the military that had reservations about Sharif moving too rapidly on the trade front without sufficient movement on other political issues with India.

The purpose of recounting this timeline is to illustrate that attempts to revive trade with India will always be politically contentious, to the point of being radioactive, if these are not indemnified by a stronger political rationale for re-engaging India that enjoys multiparty and multi-stakeholder consensus.

For now, the only path to locating such a rationale lies in either a) evidence that the political and human rights situation in J&K (which was the basis of downgrading ties in the first place) is seeing demonstrable improvement; or b) evidence that the situation has stopped deteriorating sufficiently to allow for a window for conditional engagement with the expressed purpose of resolving the Kashmir dispute.

Editorial: India trade ties

Unfortunately, any engagement with India sans either of these logics, no matter how compelling the underlying economic justification, will fail to gain acceptance amongst politicians and the street.

There are also no indications that the increasingly authoritarian BJP-led regime next door is willing to discuss the J&K dispute bilaterally unless it does so under the narrowly defined rubric of ‘terrorism’. For the most part, BJP leaders and politicians have taken the unhelpfully maximalist position that J&K is an issue internal to India — a position that remains at odds with the internationally accepted disputed nature of the territory and one that is unacceptable to Pakistan.

In the face of this intransigence, there is very little space for any Pakistani government — even one that simultaneously enjoys both an organic political mandate and a good working relationship with the military — to make a compelling political case for resuming trade. And should a government try to do so under the guise of political pragmatism, it will find itself mired in accusations of having jettisoned the national interest and capitulated to the Modi government’s current position on Kashmir.

Connectivity and regional integration are public goods that the entire region can benefit from. In the India-Pakistan case in particular, there are many compelling economic logics to be made for pushing ahead, beginning with trade. But for trade to be a viable harbinger of peace, it is imperative that this be sufficiently politically legitimate, which means enjoying an un-muddied rationale from the outset. Otherwise, expect political reversals or U-turns that are symptomatic of difficult relationships.

The writer is a political scientist at Tufts University.

Twitter: @fahdhumayun

Published in Dawn, July 14th, 2022

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