The process of trade liberalization between Pakistan and India is akin to being on the Space Mountain roller coaster ride at Disneyworld in Florida. Those enjoying this ride are not sure about the horizontal and vertical movements of the ride because it is in a dark environment. Although the ride is only for few minutes, the thrill is mind-blowing, but when the ride ends there is this dampening of the spirits. Exhilaration and then disappointment. This, in short, is the scenario in the sub-continent and is more relevant in the context of opening up the facilities for the Munabao-Khokhrapar trade and people movement. The decision on opening up of the Munabao-Khokhrapar route is another victim of a security cul-de-sac.
The perceived national security concerns, in whatever ways and means, are the major hurdles in this matter. There is another mis-conceived notion floated around that Indian goods would flood the domestic markets if allowed through the Munabao-Khokhrapar route. The frequent borders skirmishes also negatively impact upon the possibilities of opening of more entry/exit points apart from Wagah-Attari. There are twelve such points (4 in Punjab, 1 in Delhi, 2 in Rajasthan, and 5 in Gujarat) but any and all decisions related to opening up of other points are suppressed as soon as they are brought up for decision making. As stated above, there is this self-generated fear that Munabao-Khokhrapar would enhance people-to-people contact and movement and this would be detrimental to security considerations.
There is an added front loading of the cost factor due to defense concerns. The security driven technologies and procedures have escalated the transaction costs and are burdensome for many businesses, especially the SME and cottage industrial sectors. It is ironic that undocumented cross-border trade is routinely facilitated but when it comes to official cross-border movement of goods, there are all kinds of blockades. Pakistan and India are not the only two countries that have, or should have, cross-border trade. This is no Kabbadi match or a wresting bout. This is a win-win situation. Thus, anger-jingoism or patriotism should not be deciding factors, especially in this context.
Whenever the issue of Munabao-Khokhrapar pops up at various fora, the opponents or naysayers characteristically come up with two basic arguments to defuse the debate by asking what are the items of trade that Pakistan could export and that this route would make Indian goods cheaper. At the outset, it is important to understand that enumerating sectors, items, products or services that would be more facilitated if Munabao-Khokhrapar is open for trade is really short-sightedness and reflects a myopic concern for the trade mechanisms. Trade follows the best, quickest, cheapest, and safe route and it is plain economic sense that doing business does not mean wastage of time, money, and opportunity.
At the present moment, Pakistan only allows 137 Indian goods to cross Wagah despite the negative list of only 1209 items that are stipulated in SRO No 280 (I) /2012 issued on March 22, 2012 by Pakistan’s Commerce Ministry. These 137 items are in many cases a catalyst for undocumented informal trade either through the borders, in connivance with corrupt border security, or are channelized through third country route. Of course, the blow hot, blow cold attitude by Pakistan towards granting Non Discriminatory Market Access to India further complicates the fragile liberalization process. India has now hinted that it would allow mobile phone connectivity for Pakistani cellphones. One very positive move and a real Confidence Building Measure, no doubt. It is hoped that Pakistan would reciprocate too.
The decision to open up Munabao-Khokhrapar as an alternate to Wagah-Attari is not palatable to many quarters as it is a fact that once this route is made operative, most of the Indo-Pak trade and people movement could be done through this route. However, the significance of Wagah-Attari will not diminish nor would this route be unfeasible. The future lies in opening up more entry/exit points and thinking of trade and investment under the SAARC umbrella instead of just Indo-Pak trade. Opening up of Munabao-Khokhrapar will be the harbinger of economic regional integration that is a prime objective of the people of South Asia, in general, and Indians and Pakistanis, in particular.
In 2003, the then Indian Foreign Minister, Jaswant Singh, recommended the re-opening of the Munabao-Khokhrapar railway service. In February 2006, the Thar Express commenced operations after being in limbo for over 50 years. It is imperative that this second active rail connection between the two nations, after the Wagah link in Punjab, is designated as the primary channel for goods and people movement within Rajasthan, Gujarat and Sindh. The Thar Express would usher in a process of connect rather than the prevalent atmosphere of divide.
Although this matter is usually shoved beneath the carpet under the notions of provincial harmony and cohesion, the bare fact is that there is a sense of resentment when it comes to the importance of Karachi as the business and financial hub of Pakistan. The importance of a place or person is directly related to the critical mass present in that place or person. Karachi is business oriented, Karachi pays 67% of the Pakistan’s revenue, and Karachi is truly a metropolitan city and Pakistan’s melting pot. Karachi also happens to be the home for most of the people who migrated after Independence in 1947. Policies have generally been formulated where Karachi would get the least direct benefit. Despite all such actions and decisions, the importance of Karachi maintains its growth and its velocity.
The dilemma is that there seems to be an inherent distrust about the citizens living in Karachi or in Interior Sindh by certain elements in the corridors of power and this has also been the overarching factor in conjuring up flimsy excuses to delay the opening of the Deputy Indian High Commission in Karachi. The Indian DHC was renovated and made ready some years back for Consular and other diplomatic activities. Today, it is again showing signs of neglect and ruin. Indecision and misplaced concerns about trade and investment liberalization, facilitation, and encouragement would also lead to the continuation of a fear mindset instead of defusing tensions and facing challenges, thus deferring the desired objective of regional economic integration.
Alexis Tocqueville very rightly hoped that “Trade is the natural enemy of all violent passions. Trade loves moderation, delights in compromise, and is most careful to avoid anger.”