Indo-Pak trade normal

The current political turmoil in Pakistan notwithstanding, trade ties between India and its neighbouring country are unlikely to be affected in the near future. However, industry representatives say in the long run, trade between both the countries could take a hit if the instability continues.

"We have not seen any impact on cross-border trade with Pakistan. Things seem normal at the ports," said a commerce ministry official.

Exports from India increased by 95.63 per cent to $1.3 billion in 2006-07 against $690 million in the previous fiscal. Imports from Pakistan in the same year were worth $320 million, an 80 per cent increase over the year-ago figure of $180 million.

Within the SAARC block, India has been the biggest trading partner of Pakistan in the last six years. According to analysts, India's share in Pakistan's total trade over the last six years stands at almost 50 per cent within the region.

Following the relaxation of cement imports earlier this year, Pakistani companies were planning to export 6 million tonne of the commodity to India annually making it its largest market for cement. Moreover, after a series of talks between the commerce secretaries of the two countries, India and Pakistan had recently allowed trucks to cross the Wagah border post for unloading goods.

However, negotiations to open up border trade along the line of control (LoC) in Jammu and Kashmir may slow down because of the heating political scene in Pakistan.

"The emergency in Pakistan will not impact trade between India and Pakistan in any way as the trade policy has not been disturbed. Trading is being done as usual and there are no reports of a slowdown," said Tariq Sayeed, former chairman, Pakistan Chamber of Commerce and Industry, and secretary general, SAARC Chamber of Commerce and Industry.

The Federation of Indian Chamber of Commerce and Industry (Ficci) said: "The trade as of now remains undisturbed, given that regular infrastructure like railway continues to operate as usual. But in the future, Indian business houses might get apprehensive about trade with Pakistan. Also, traders who were contemplating to initiate trade relations with Pakistan may put their plans on hold".

Speaking to Business Standard, Krishan Kalra, secretary general, PHD Chamber of Commerce said: "According to the World Bank, trade between the two countries can even go up to $9-10 billion by 2010. But such incidents can deal a huge blow to the trade."