With an economy inching towards stabilization and improvement, Pakistan’s bilateral and regional trade priorities are to trade more. Matter of fact, the country’s economy cannot grow if it won’t open up to the neighbors.
With this understanding, the country seems to be committed to resolving long standing issues with its neighboring countries and to enhance trade and economic relations with them. Faced with a faltering economy, importance of bilateral and regional trade was highlighted in the run up to the gone by elections when the country’s all major political parties’ manifesto promised to follow a three point agenda of trade, investment, and connectivity within the region and with outer world at large.
There are no two opinions on the fact that Pakistan’s economy is going through a difficult phase as the country is witnessing robust economic reforms for promising fruits in the long run. The importance that Pakistan designates to trade with its neighbors is evident form the fact that it has abolished its positive trade list with India, and has replaced it with a significantly small negative list. After this initiative, about 85 per cent of Pakistan’s import market has become accessible to India. Moreover, legislation is underway to create land ports at crossing points with India, Iran and Afghanistan.
In terms of enhancing trade, one of Pakistan’s successes was to obtain GSP plus status from the European Union. This was a significant achievement and a first ever trade concession given to the country by the Europe. More importantly, this concession was not given to Pakistan as a quid-pro-quo, rather, Pakistan went through a rigorous scrutinizing process to get approval from the European Commission.
The GSP plus status given to Pakistan is not a reward of its reforms for better human rights conditions in the country, rather it is an incentive to do so. Now the country is looking at the United States for similar incentives. Pakistan’s trade with the United States is little over $ 3 billion – mere 0.00016 per cent of United States’ total trade volume of over three trillion dollars. Pakistan believes that giving it trade concessions will not cause a trade injury to the US economy, but it will make huge differences in terms of increasing employment and eradicating poverty in Pakistan.
Pakistan is also in the process of benchmarking tariffs with its neighbors, and the country is looking forward to quadruple its exports in the next three to five years. Through laying the foundation for a stronger economy, the country will enhance credibility of democracy among its masses. Admittedly, robust economic relations can go a long way in repairing the mutual relations between Pakistan and the United States.