The Hindu Business Line : Future of Indo-Pak trade

As far as economic ties between India and Pakistan are concerned, the imposition of an emergency on Pakistan by General Pervez Musharraf is certain to have an impact.

The question is: Will this impact help in forging better ties between the two countries or will it upset the applecart of the little progress that has already been made in the sphere?

The uncertainty

Taking the first point, a Government crisis in Pakistan can help promote better economic relations with India only if there is the prospect of a friendly regime coming to power in Islamabad. No one as yet knows what the fallout will be of the process Gen. Musharraf has set in motion with his emergency declaration of November 3. However, if history is any guide to the future, what one can be certain of more or less is the fact that the dictator’s days are now numbered, the inference being that there will be a new power dispensation in Islamabad very soon. The question, again, is: What sort of dispensation will that be?

True, the usual Pakistani ‘official’ work will not stop in view of this uncertainty, which is why the SAARC meeting slated to be held in Dhaka later this month will be held in the normal course with a delegation from Islamabad attending it.

Again, in the normal course, no one is expecting any drastic change in Pakistani policy on ongoing SAARC negotiations at various levels.

But it is common sense to expect that if the political crisis back at home gets even more complex than it already is, with changes threatening the administrative hierarchy in a number of spheres and at various levels, there will be a standstill in Pakistani negotiating positions not only in SAARC but at other international forums (both bilateral and multilateral) as well.

Trade across LoC

This is perhaps why early reports emanating from New Delhi appear to suggest that the perceived thawing process in the area of trade across the line of actual control will be affected.

As matters stand now, Islamabad has rejected five of the 14 items selected by New Delhi for trade across the LoC, the five being leather and leather products, juices, jam and honey, readymade tin-packed foods, copper and silver items, and fabricated items such as gold ornaments.

On its part, New Delhi has agreed to trade in six of the 16 items proposed by Islamabad, among the rejected items being spices, apples, walnuts, rice, paper and carpets.

Though the specific points along the LoC through which trade will be conducted have not yet been decided upon, there has been some progress in the larger sphere of border trade with trucks transporting identified trade-items being allowed to cross over into the terrority of the destination-country.

There is general agreement on the fact that direct trade between the two countries will be far more beneficial to the two economies than the sort of trade taking place today, where Indian goods are having to find their way into Pakistan through third countries like, say, Dubai, adding to costs.

Admittdly, direct free trade between the two economies is liable to disrupt the Pakistani domestic market to some extent in view of the stronger economic muscle-power Indian products wield compared to Paksitani export items. But, in the first place, there is no reason why free trade should be “uncontrolled”, especially when one of the two trading economies is likely to face domestic hiccups in the course of the implementation of such a policy.

Washington’s role

But to get back to the more fundamental problem of the sort of Government Pakistan is likely to have after, maybe, a few weeks, which is certain to cast its long shadow on bilateral trade ties between India and Pakistan, what is most likely is that there will be no quick return to civilian rule in the sense Indians understand it.

This is because there is a strong possibility that Washington, which is playing a very detailed role behind the scenes in the efforts to resolve the current crisis, will most certainly want whoever is in charge in Islamabad to be able to prosecute as effectively as possible anti-terror policies, directed mainly at curbing the growing power of fundamentalist movements like al Quaeda and similar groups.

Indeed, the internal threat to Pakistan’s polity from this specific source is today at its most critical level, the danger being multiplied manifold by the fact that there is little effective security prevailing at the Pakistani nuclear installations.

This view will perhaps be challenged, but the fact remains that if the Pakistani military establishment is itself wracked by fissures, some of which are occassioned by deeply-held religious beliefs, is there any guarantee that the nuclear installations (and warheads, mostly of the tactical type) will continue to enjoy foolproof protection from terrorists operating at the global level?

Another military strongman?

Probably not, which means that a civilian outfit in control of Islamabad can perhaps be safely ruled out at the moment.

In other words, for the time being at least, it is more than likely that another military strongman will emerge to take over the reins of power in Pakistan, with the backing of Washington.

Whether such a development will be able to curb to any extent the gradual expansion of the area under fundamentalist-terrorist influence is a moot question, but the fact remains that a “military-strongman outcome” of the search for a new Government in Islamabad will probably be the best given Pakistan’s precarious position in terms of social stability and its consequent need for a ruling regime that can, in a manner of speaking, “impose” stability — and reduce the threat of fundamentalist-terrorism gaining the upper hand.

Favourable ‘solution’

Unfortunately, for India, this “solution” — where the basic principles of democracy and respect for individual freedom are eclipsed — would seem to be the most favourable in the circumstances because it could lead to the formation of a Government in Islamabad which would be strong enough to have, among other things, a settled trade policy, to which New Delhi would be able to respond effectively.

Secondly, a strong Pakistan Government would probably be better positioned to tackle the problem of export of terrorists to India, which would be greatly to New Delhi’s advantage.

Compare this with a scenario where a civilian Government in Islamabad and the Pakistan military — always at loggerheads and forever suspicious of each other — would invariably lead to situation which would create a more complex operating field for New Delhi’s policymakers vis-À-vis Pakistan.

The point, therefore, is: As far as Pakistan is concerned, is it a case of “Musharraf is dead; long live Musharraf”, no matter how unacceptable the slogan is for those who would want to put the Constitutional rights of the average citizen above everything else?

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