If wishes were horses . . .

If wishes were horses, the saner elements in Pakistan and India would begin to implement in right earnest economic cooperation between the two countries which, according to the most recent estimates, would catapult the bilateral figure to around $14 billion, up from the current roughly $2 billion. In fact, such a wish has been around for as long as one can remember, the tragedy being that on every occasion when there has been a strong chance of implementation, vested interests have disrupted the proceedings. The present is one such occasion when the chances of things working out right on the trade front have never been better. The hope is that this initiative, too, must not be let go waste.

Defining point

The defining point about the still shining ray of hope is that the two Governments concerned have themselves taken the bull by its horns, something which has rarely happened in the past. The most important development is the change in Islamabad's stand on the Most-Favoured-Nation issue; in the past (despite recent feelers indicating a softening of the stand) the Pakistanis were being rather rigid in their approach to the subject. To take just one instance, in February 2006, as reported in The Hindu , Islamabad reiterated unequivocally that “full trade relations between the two countries were not possible without a resolution of the Kashmir issue”.

That the road travelled since then has been a pretty long one is indicated in the agreed minutes of the recent meeting between the Commerce Secretaries of the two countries which state, among other things, that Pakistan “recognised that grant of MFN status to India would help in expanding the bilateral trade relations”. The relevant section of the minutes adds conclusively that “both sides agreed to remove the NTBs (non-tariff barriers) and all other restrictive practices which hamper bilateral trade”.

The MFN issue defines the broad framework within which bilateral trade between the two neighbours can be conducted, and there is little doubt that Islamabad has taken a big leap forward in sorting things out for the better between the two countries (New Delhi granted MFN status to Pakistan some years ago). But the meeting between the Commerce Secretaries did not solely focus on the macro aspect of trade issues.

A redeeming feature of the meeting is that it applied the magnifying glass to specific sectors such as petroleum products and power, to name only two, the officials involved not merely mentioning the subjects and their potential to increase bilateral trade but also laying down time-barred road maps which, at the very least, suggests that both countries mean strict business this time around.

Expectedly, some quarters in Pakistan have already opposed Islamabad's intention to grant MFN status to New Delhi. But this time the powers that be across the border – and this includes the Pakistani military, for without its sanction the civilian Government could not have moved at all – appear to be determined to open the door to bilateral trade, and there is now little doubt that matters will unfold in a beneficial manner, assuming there is no last-minute hitch.

But this is a crucial assumption. Simply put, since the other side is Pakistan, one cannot be sure that the policy enunciated at the secretary-level meeting will be implemented smoothly. If the Pakistani military establishment has agreed to a normalisation of trade relations with India, it has done so with a larger canvas in mind. And that canvas still has Kashmir as the thorn in India's side.

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