Pakistani economist wants more trade ties in South Asia

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SME Times News Bureau | 12 Sep, 2014
Pakistani economist Ishrat Husain Thursday said he was "appalled" at the low level of trade in South Asia, and urged the present generation in India and Pakistan to find ways to take the economic cooperation forward.

He said political relations have been dominating the India-Pakistan dialogue and economic reasons have been subservient.

"I am speaking as a South Asian, not as a Pakistani," he said at an event at the Jamia Milla Islamia University here.

Husain urged the present generation in both countries, who do not have the "baggage of partition", to find ways to take the economic cooperation forward.

He gave the example of East Asia, which has been able to become an economic powerhouse, with a 'regional value chain'.

"What we see as 'made in China' is worked upon in Vietnam, Indonesia and other countries in the region before it is a finished product," he said.

"This has made the countries in the region economic partners."

South Asia, which was once a common unit, with a shared language, history, contiguous area and shared infrastructure has lagged behind East Asia, where divergent countries with no such similarities, now have very strong economic bonds, he said.

Currently, except Bangladesh, which has been able to take raw materials from its neighbours and become a garment manufacturing powerhouse, the shared value chain is missing in South Asia, Husain said.

Husain, who has been a governor of the Pakistan State Bank, is currently the dean of the Institute of Business Administration in Karachi.

Other than economic cooperation, the countries also need a shared climate change agenda, as floods see no border, he said, referring to the massive floods in Jammu and Kashmir and Pakistan-administered Kashmir.

Husain has held many senior positions as an economist. He has been lobbying with the Pakistan government to give the "Most Favoured Nation" status for trade to India.

Husain said this measure was almost given to India in December 2012 and in February this year, but was held back due to the Pakistani elections and then the Indian elections.

He quoted various studies as saying that trade between India and Pakistan could multiply by between five and 20 times, if the right measures are taken.

He said he saw hope in statements by Prime Minister Narendra Modi that trade and economic cooperation was the way to take international relations forward.