THE contrast between tense Pak-Afghan ties and deteriorating Pak-India relations on one side and the fresh impetus in the Indo-Afghan relationship on the other make it extremely unlikely that reason will prevail in the ongoing Pak-Afghan transit trade tug of war. But the pragmatic, sensible and mutually beneficial case for opening up trade routes across Pakistan and Afghanistan needs to be restated — because, perhaps even more so than the north-south trade envisaged under CPEC, the east-west trade across Pakistan and Afghanistan has vast economic potential. First, however, the conflicting positions of Pakistan and Afghanistan need to be understood. The decision by Afghanistan to bar Pakistani cargo from entering Afghanistan en route to Central Asia, as per the terms of the 2010 Afghan-Pakistan Transit Trade Agreement, will have minimal immediate impact because little, if any, Pakistani trade with Central Asia is conducted overland through Afghanistan. What has been dented, though, is bilateral Pak-Afghan trade in recent months, a development that can be directly linked to tensions in Chaman and Torkham and bickering over security and foreign policy between Pakistan and Afghanistan.
Meanwhile, the core of the Afghan demand is relatively straightforward: access to Indian imports into Afghanistan via Wagah rather than the Karachi port. The land route is quite obviously cheaper and quicker, but Pakistan only permitted Afghan exports to India to be trucked overland to Wagah — Afghan imports from India are not allowed via Wagah. Pakistan’s official reasons for denying the Afghan demand (one that India is keen on too) are varied and some of them do have merit. Topmost is the concern that Indian goods under Afghan transit trade will either be sold in Pakistan before reaching Afghanistan or re-exported back to Pakistan once they arrive in Afghanistan, thereby hurting domestic businesses. But that is a concern that can be addressed by requirements such as sealed containerised cargo, biometric devices and stricter trade oversight along Pak-Afghan border. In truth, with Pakistan unwilling to normalise trade with India, the acceptability of large-scale Indo-Afghan trade across Pakistan is necessarily low in security-centric policymaking circles. While the costs and benefits of trade must always be carefully evaluated and the interests of local producers and consumers need to be balanced, Indian goods are loaded with political baggage in a way that perhaps Chinese goods, which have long flooded the Pakistani market, are not.
Given the circumstances, however, perhaps the first steps towards a rational trade policy across West and Central Asia, with Pakistan embracing not just north-south trade with China but east-west too with India, Afghanistan and Central Asia, is to try and nudge Pak-Afghan and Pak-India ties on a path to stability. The failure of the Quadrilateral Coordination Group and the stillborn Comprehensive Bilateral Dialogue has rendered relations with both Afghanistan and India juvenile shouting matches, though with potentially very dangerous consequences. Afghanistan demanding closer ties with India is Afghanistan’s right, but overland trade between those two countries is unlikely to go anywhere if Kabul’s approach remains accusatory and rancorous.http://www.dawn.com/news/1283530/transit-trade-spat
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