The sentiment is commendable: Federation of Indian Chamber of Commerce and Industry (FICCI) Durgesh Buxy and Federation of Pakistan Chamber of Commerce and Industry (FPCCI) agreed that there is a strong need to normalize trade relations between both countries as it helps in generating readily available raw material, requires cheap transportation and reduces cost production. All in all, it spells out prosperity for economies and masses in both countries. By participating in the emerging business opportunities in India and Pakistan along with the removal of the Non-Tariff Barriers (NTB), both can improve bilateral economic cooperation which aids in inclusive growth for Indians and Pakistanis.
There are two sides to this picture. On one hand, FICCI and FPCCI do aspire to nurturing the normalization of trade relations while also promoting Indo-Pak economic growth. And they have a solid reason for this goal: Bilateral trade between both countries has witnessed an increase in growth from $250 million in 2003 to $2.6 billion in 2013, which is an annual growth rate of 25 per cent in the last 10 years. On the other hand, there is that disadvantage against Pakistani farmers who remain, for the most part, neglected by their government. Indian farmers receive subsidies from the government to the tune of $50 billion while agrarian workers in Pakistan barely make ends meet. Agriculture in India is heavily protected through tariff, non-tariff and technical barriers.
Opening up trade through the Wagah border under liberalizing trade is an issue that remains controversial among the Pakistani agricultural community: Pakistan Kisan Itehad and Farmers Association of Pakistan have raised the contention of unequal water distribution before the FPCCI in order for it to reconsider its potential pact with FICCI. Furthermore, there is no agreement within Pakistan that protects its farmers and secures reciprocal market access in India. The energy crisis and weather conditions remain, but the fact that the agricultural sector is already paying around 22 different taxes ranging from General Sales Tax (GST) to market tax should knock some sense into the Council of Common Interest to make tax more comprehensive and less stifling for the average farmer’s life.
Before signing any agreement involving free trade between both nations, Pakistani policymakers must assess the strategic and economic impacts of closer bilateral trade ties on the Pakistani agrarian sector. Focus on mitigating their plight first.