|
|
This is only a preview of the paper
Click here to register and get the full text.
Existing members click here to login
|
|
|
Bilateral trade between India and Pakistan is extraordinarily low—less than 1 percent of their global
trade. Their volatile political relationship has overwhelmed attempts to encourage trade between the
two countries, and has also impacted economic integration in the South Asian region as a whole.
There are both political and economic obstacles to expanding trade between the two countries.
Greater economic co-operation could, however, provide mutual economic benefits, such as lower
prices for consumers, much-needed revenue for the governments, and cost-effective gas import to
India via Pakistan. ...
Brief history: In 2000-2001, India exported only $186 million worth of goods to Pakistan, out of $44
billion in total exports. Pakistan’s exports totaled $8.8 billion, but only $65 million went to India. The two
countries have not always had such anemic trade. Before partition and immediately after independence,
India was Pakistan’s most important trading partner. In 1948-49, 56 percent of Pakistan’s total exports were
directed to the Indian market, and 32 percent of its imports came from India. Lahore and Amritsar were
important economic hubs, as trade flourished with a free flow of goods and services. However, by the early
1950s trade between the countries reduced to a trickle, and despite some ups and downs has not revived
since.
Political obstacles to trade: The biggest barriers to trade are political. Because of India’s market size and
central location, 80 percent of intra-regional trade in South Asia is to or from India. All India’s neighbors
share a concern about being overwhelmed by Indian goods. Decades of mutual political hostility and
suspicion compound the challenges in trying to build strong trade relations between India and Pakistan.
Both sides tend to see progress on issues like trade as a favor to the other country rather a benefit to one’s
own country. Pakistan, moreover, is reluctant to move too fast toward normalization of trade and other
relations with India lest the issue of Kashmir get sidetracked.
Economic barriers: In the decades following partition, both India and Pakistan adopted inward-looking
economic policies that discouraged imports of consumer goods or of anything that could be made locally.
Approximate Word count = 1701
Approximate Pages = 6.8
(250 words per page double spaced)
|
|
|
|
|
|