By Mehtab Haider
LAHORE: Pakistan and India can increase bilateral trade level to up to $25-30 billion over the next 10 years if both countries move towards placing level playing field for each other.
“In next five years, the conservative estimates suggest that bilateral trade between Pakistan and India can surge to $10-12 billion which could be increased further to $25-30 billion over the long term,” former governor of the State Bank of Pakistan (SBP) Dr Ishrat Husain, who is currently serving as Dean Institute of Business Administration (IBA). He was talking to The News on the sidelines of the 2nd Aman Ki Asha Indo-Pakistan Economic Conference on Monday.
Rakesh Bharti Mittal, Managing Director of the Indian telecom giant Bharti Enterprise Ltd, told this scribe that the level of bilateral trade was not so much but building mutual trust would go a long way to get the desired results.
Mittal cited examples of China and Taiwan where 80 percent trade is in favour of Taiwan while share of China is just 20 percent so in case of Pakistan and India bilateral trade would become beneficial for both countries.
However, Dr Husain recalled that when he was serving as governor SBP, a study was conducted to evaluate potential of Pak-India trade and it was found several years ago that bilateral trade could touch $5 billion mark.
He said that it could be win-win situation for both countries as India possessed 300 million people market and if Pakistani entrepreneurs get market share of one percent there will be market of 3 million additional people available to them. Pakistan’s domestic market is in the range of 30 million people so additional 3 million market means that market share of its products can be enhanced by 10 percent.
He said that Pakistan’s ministry of commerce had placed over 1200 items on negative list for trade with India that was a major shift from past when positive list was used to do trade with New Delhi.
“After holding hectic consultations, trade authorities have placed around 1209 items in negative list for holding bilateral trade with India,” he said adding this list would also be phased out gradually.
To another query regarding negative impacts for small and medium enterprises (SMEs) of Pakistan, he said that it would give them an opportunity to double or triple their sales after getting share in the biggest market of the world.
“We are in the middle of two economic giants of the world – China and India – and there is a need to exploit the real potential,” Dr Husain said and added that there would be few losers in Pakistan but by and large the industry and consumers would get benefit with normalization of relations and enhancing trade ties with India.
“When Pakistan had taken decision to liberalise trade by bringing down customs tariffs hue and cry was raised that it would cause damage to our industry but later on it was proved that nothing of this sort happened so in case of trade with India it would not happen again,” he added.But he strongly advocated for persuasion of enhancing trade relations in well-managed and well-structured style in order to avoid emotions getting the main driving seat.
