For India, trade and terror with Pakistan cannot go together
Pakistan PM Shehbaz Sharif's indication of resumption of trade with India, while not ceding an inch on Kashmir as a precursor to peace has a dual objective of addressing the extremists and the economic mess within the Islamic Republic. But the real goal of trade softener is to entice India to remove its opposition to Pakistan remaining on FATF's grey list at Paris Plenary this month.
After stating in his first address to the nation that durable peace was not possible till the Kashmir issue was resolved, Pakistan Prime Minister Shehbaz Sharif has indicated that he is a votary of the resumption of bilateral trade with India.
In an interview with a Turkish news agency, Sharif said: “We are cognizant of the economic dividends that can be accrued from healthy trade activity with India” and called it a part of Islamabad’s shift from geo-strategy to geo-economics. At the same time, Sharif has spoken on Kashmir and demanded restoring Article 370 in Jammu and Kashmir, more than five times since he took over in April.
After granting the most favoured nation (MFN) status to Pakistan in 1996, India withdrew it a day after Pakistan based Jaish-e-Mohammed terrorist group targeted a CRPF vehicle in Pulwama in a suicide attack, killing 40 troopers on February 14, 2019. The total bilateral trade between India and Pakistan was USD 329 million in 2020-2021. This has gone up to USD 514 million in 2021-2022, as per the ministry of commerce, with Indian exports outnumbering imports from Pakistan. Pakistan has never granted MFN status to India despite being a member of the WTO regime.
PM Sharif’s desire to resume bilateral trade with India without giving up either the claim on Jammu and Kashmir or uprooting the India specific terrorist groups in Pakistan is no different from China’s desire to multiply bilateral trade with India without letting up military pressure all along the Line of Actual Control (LAC) and dragging its feet on restoring April 2020 status quo on patrolling point 15 on Kugrang River in Hot Springs sector of East Ladakh.
The India-China bilateral trade stood at USD 86.36 billion in 2020-2021 and climbed up to USD 115.41 billion in 2021-2022 with Indian trade deficit touching more than USD 71 billion. The jump in trade with China despite military tensions on the LAC is a clear indicator of Beijing’s global clout in the manufacturing sector and a strong case for PM Modi’s “Atmanirbhar Bharat” initiative so that India is weaned out from the Chinese grip.
Despite the Indian and Chinese Army fully deployed in East Ladakh after PLA transgressions in May 2020, the Xi Jinping regime wants India to focus on improving economic cooperation while virtually dismissing India’s demand for restoring the 1993 and 1996 bilateral agreements on the ground for peace and tranquility on the LAC. This parallel diplomacy has been the hallmark of strategy of Chinese Communist Party since the 1980s and has no concessions on the LAC in-built in that plan.
While India has taken note of PM Sharif’s interview, it also understands the economic and political mess that Pakistan is in and how increased bilateral trade could help Islamabad’s economic recovery with Indian market having a large appetite for imports from Pakistan. However, the current political instability in Pakistan, with ousted PM Imran Khan Niazi, exiled leader Nawaz Sharif putting pressure on the Sharif government for an early general election with Pakistan Army remaining a neutral bystander, will hold back any Indian response.
Fact is that India is in no hurry to resume bilateral ties with Pakistan till such time Islamabad acts against terrorist groups like Jaish and Lashkar-e-Tayebba (LeT) which continue to wage Islamic jihad against minorities in Kashmir Valley in pursuit of Islamabad’s political aims. Even though Islamabad has told the global Financial Action Task Force (FATF) that it cannot locate Jaish terror kingpin Masood Azhar, the recent court action against LeT’s chief Hafeez Saeed is all part of the effort to get Pakistan off the Grey List in the Paris Plenary this month. For India, trade with Pakistan and terror cannot go together.
