Trans-LOC Indo-Pak Trading

Prof. Bhat summarizes the proceedings of a special session on ‘trans-LoC Indo-Pak trading’, held during an international seminar on regional economic integration, in Kashmir university, a few months back

Economic justification for trans-LoC Indo-Pak trade

(Prof G M Bhat the head of the department of economics at the University of Kashmir, Srinagar. He was the co–chairman of the special session on Trans LoC Indo-Pak trading.)

A special session on “Trans LoC Indo-Pak trading” was held during the 3-day international seminar on “Regional Economic Integration among South East Asian countries” which was jointly organized by the Department of Economics, University of Kashmir and International Institute of Developmenatl studies (IIDS), Kolkata.

The speakers of the session impressed the need for India and Pakistan to formulate a policy to facilitate the cross LoC trade, while maintaining that the trans-LoC trade could expose Kashmir to the International market and open new avenue for its industries. Among another distinguished guests, Prof Riyaz Punjabi, Vice Chancellor, Kashmir University and Prof Ashok Mathur, Institute for Human Development, New Delhi were present during the whole session.
Mr. Shakeel Qalander, President, Kashmir Chamber of Industries said that trade with Pakistan was just a political gimmick and production in Kashmir had been insufficient for export to other countries, made the first presentation. He further pointed out “We are lagging behind other countries in production and the government is not making any attempts to boost the industrial sector here. When we cannot produce enough to suffice our own needs how can we trade with Pakistan.

The second presentation was made by G.A. Qureshi, Director General, Department of Economics and Statistics, J&K. He presented the paper on ‘Trans border Indo-Pak trading “. He discussed about the historical perspective of trade between India and Pakistan, through Jammu & Kashmir in which he discussed about the situation before 1947; when India and Pakistan was just one country. This was the time when the volume of trade was high and the level of poverty was high. During that time shawl was the main composition of the exports of J&K. At present, it includes dry fruits, fresh fruits and of course handicrafts. The actual potential of exports is of about 2 billion to 10 billion US $. It can see joint ventures coming up in the sectors of Health, Education and Tourism.

Dr. Mubeen Shah, President Kashmir Chamber of Commerce and industries (KCCI), while presenting his paper said that Kashmir has the expertise in the production of silk, carpets and the products that have an international demand, but the closed market has affected the industries badly. He said that if cross-LoC trade can begin, the artisans could sell the products to countries like Iran where the products have a great demand. He further pointed out that horticulture in Kashmir had been suffering for want of cold storage disallowing the sale of fruits in the far off Indian markets and thus worsening the problem. The trade with Pakistan would allow the fruit from premiere fruit producing areas like Baramula to reach the nearer markets of Pakistan within short time.

A Research Scholar, Jiji Paul, from the University of Kerala said that the two countries have to create a feeling of mutual understanding and tolerance to reach to a level of comfort conducive for solving those bigger issues that have so long troubled both India and Pakistan. He pointed out that the current volume of trade between India and Pakistan does not commensurate with the existing potential. He said that the political games create fearful atmosphere in both the nations and destroy all hopes, dreams and expectations of both the countries.

Dr. G.R.Ghani, IAS, Commissioner Settlement, presented a paper on “Trans LoC trade between India and Pakistan via Kashmir- Prospects and Potential.” He said that the concept of trans-LoC trade between India and Pakistan via Kashmir has assumed special significance in the context of normalization of relations between the two countries followed by a better understanding of the issue of J&K, which has been at the centre of controversy over the past 60 years. In the process of restoration of bilateral trade between the two parts of Kashmir, the key objective has been to establish this facility at certain points along the LoC between Indian side of Kashmir and Pakistan administered Kashmir (PaK). He said this development will have a healthy impact on the development of J&K economy.

Deputy Director, Census Operations, J&K Shri C. S. Sapru said that India-Pakistan trade is presently taking place through three channels. Firstly, the illegal trade through the land borders, secondly, the circular or “informal” trade, which is carried out through “third” countries and re-exported from there to Pakistan and thirdly, the formal trade, which is carried out through the official means. The estimated value of the trade through the illegal channel is around US $ 1 billion. He said the total size of the illegal trade is much larger than the official trade between the two countries; thus by removing the trade barriers between both the countries, the bilateral trade can enhance their mutual benefits. He further emphasized that for this free trade zones should be established.

Haji Abdul Majid Butt, a Geo-scientist, KAS Officer (Retd.), presented a paper on “Minerals of J&K State for trade with PaK/Pakistan.” He views the potentiality of trade between India and Pakistan through Jammu & Kashmir, Kashmir being rich in lime stone, gypsum, marble, borax, lignite, and Jammu in semi-anthracitic coal, gypsum etc… and on the other hand Pakistan can offer ruby, sapphire, topaz, rock salt, tourmaline, agate, for trade with J&K/India. This step according to him would try to reduce the distance between India and Pakistan’s political relations.

Dr. Imtiyaz-ul-Haq and Mr. Ajaz Ahmad Rather gave their presentation on “Indo-Pak economic cooperation - a step towards greater Asian economic integration.” In their presentation, they said that India and Pakistan are the two major economies of SAARC and the low level of integration has made the trade performance very poor. They considered the present political scenario of the countries as one of the major cause for the situation. They said the economic condition of the two nations is very poor with more than one quarter of population below the poverty line. Prosperity in the two nations can only be achieved by establishing conducive economic relations by opening the border trade which is advantageous not only to these two countries but to the whole continent.

In conclusion, former Tourism Minister, Gulam Hassan Mir, the Chairperson of the session said that ‘the solution to Kashmir issue will take time, but we should try to develop other sectors like cross border trade for the development of the state’. He further said that trade with Pakistan was not only for the economic reasons but it was the will of the people on both the sides to come in trade relation with each other. He pointed out that Kashmir has been the victim of Indo-Pak hostility over the years and there has been so much bloodshed. He said that we should start from somewhere and let the trade across LoC start at the earliest.

He further asked the delegates of the seminar to take the message across the State and make this seminar a fruitful one. Prof Saif-ud-din Soz, Union Minister for Water Resources who was the the Chief Guest of the valedictory function stressed on both the neighboring countries to take steps to make trans-LoC trade possible for the betterment of Kashmiri people.