China, India, and Russia, the largest economies in the SCO, drive much of the intra-bloc trade, primarily in energy, raw materials, and manufactured goods. India’s imports largely come from China and Russia, while Russia mostly trades with China and exports to India. Pakistan’s official trade within the SCO is marginal. While informal trade and smuggling occur across Iran’s borders, Pakistan’s formal trade deficit with SCO countries widened by over 40pc in the last fiscal year, reaching $11.7 billion, mostly driven by imports from China.

A common grievance among SCO members is the West’s use of tariffs and sanctions, something China, Russia, and Iran have experienced firsthand. However, within the bloc are countries like India, often seen as aligned with the US, and Pakistan, which depends on America via the IMF for financing and as a key export market. These diverse, sometimes conflicting interests in a polarised world hinder the SCO from effectively achieving common goals, limiting its potential as a cohesive economic force.

Published in Dawn, The Business and Finance Weekly, October 21st, 2024