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| Tuesday, 16 March 2004 |
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Chambers agree to proposal: Lanka to host Indian-Pakistan trade exhibition Sri Lanka will host an Indian-Pakistan trade exhibition in Sri Lanka for the first time this year. According to President, SAARC Chamber of Commerce (SCCI) Macky Hashim who returned to Sri Lanka after attending the Indo-Pakistan Trade exhibition in New Delhi last week, the two Chambers in Pakistan and India have agreed to this proposal.
Hashim said that the Indo-Pakistan Trade Exhibition in New Delhi, held after a lapse of nearly three decades was very successful both politically and by way of business "There were over 100 stalls and Ministers and business leaders from both countries attended it," he said. The exhibition was a platform for businessmen in the two countries who were virtually separated due to the political crisis to form new relationships. It also helped business leaders to find new partners, share technology and penetrate a new market. Hashim said that its success prompted him to host this exhibition in Sri Lanka. He has already done the spadework and the two Chamber Federations in India and Pakistan have agreed to this proposal. "The Federation of Chamber of Commerce and Industry of Sri Lanka will organise this event and we are hoping to open it to Sri Lankan businessmen as well which would expose them to the Indian and Pakistan markets," he said. Hashim addressing the inaugural ceremony said that the SCCI would extend its full support to the business community in Pakistan and India in facilitating their trade routes. This is crucial as the trade links between these two countries have the potential to become the driving force for the success of SAARC as a whole. Relations between the two countries have improved considerably in the past 12th SAARC Summit scenario. India-Pakistan trade at present is 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 World countries and re-exported to Pakistan and thirdly the formal trade through official means. "This substantial smuggling of goods and commodities between Pakistan and India is an indication of the mutually profitable economic opportunities. It also reflects the suppressed desire of the business communities in either country to trade with each other," he said. Despite political issues being unresolved, there is a considerable amount of illegal trade taking place between India and Pakistan. Some of the items, which are being smuggled into Pakistan from India, include industrial, machinery, cement, tyres, chemicals and tea. Commodities smuggled into India from Pakistan include pulses, edible oils, and dry fruits. The official trade between the two countries is around US$204 million and unofficial trade is five times the official figure. The business community in both countries feel that by more open and free trade between India and Pakistan the economies of both countries would stand to gain tremendously. India and Pakistan are agrarian economies and as such there is vast scope for co-operation in the field of agriculture. Just like coal and steel were the lead sectors in European integration, there is every possibility of agriculture emerging as the major sector in which co-operation and joint action can benefit both countries especially in the context of the liberalisation of these sectors. "Given the fact that these countries share a common border, they can gain a lot by mutual trading due to low freight costs. For instance, Pakistan imports iron ore from Brazil and Australia and tea from Kenya at higher prices. These items can be purchased at much cheaper rates from India. Similarly, pharmaceutical products in India are about 30% cheaper than in Pakistan and can fetch a good market there. Other Indian items, which have potential for export to Pakistan are tea and coffee. These items are currently being smuggled into Pakistan," he said. At the same time, India will offer a vast market for Pakistan is in an advantages position to export products such as cotton yarn and textile fabrics, leather products, surgical instruments, sports goods, electric fans, water coolers, vegetables, fruits and sugar. Pakistan is already exporting textile yarn and fabrics to India, which can be accelerated. Since India is capable of providing Pakistan with cheap and good quality raw material, machinery and consumer goods the Pakistani consumers would benefit, as they would have a variety of choices available at cheaper rates. The government would be a beneficiary, as illegal trading across the border would be stopped. It is time to understand that the member States of SAARC will have to act together by sharing information and technology that will help develop cooperation and result in prosperity in business relationships not only in India and Pakistan but also SAARC as a whole. "This will enable us to mutually evolve strategies that overcome barriers and cope with growing markets," he said. Hashim also addressed a seminar in New Delhi on the proposed South Asian Federation Preferential Agreement (SAFTA), which would come to effect from 2006. |
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