Unresolved disputes and the zero-sum nature of Pakistan-India relations remain the main impediments to any significant move towards South Asia’s economic integration.
Almost 90 per cent of the region’s GDP is accounted for by India and Pakistan. It is therefore this relationship that counts both in terms of the expansion of intra regional trade and South Asia’s exports to the rest of the world. Several studies estimate that bilateral trade can easily surpass the current official level of $2 billion a year and that the potential – if informal channels are ‘formalised’ and the cost of trading through third parties lowered – is considerable. Some have put it at over $10 billion a year.
Without normalising ties and resolving outstanding disputes it is hard to see how this potential can be realised. Nor can the promise – and premise – of the South Asian Association of Regional Cooperation (Saarc) be met.
More >>>
Location:Islamabad
