Is LoC trade collapsing?

Discussion in 'Economy & Infrastructure' started by Rage, Jun 30, 2009.

  1. Rage

    Rage DFI TEAM Stars and Ambassadors

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    Is LoC trade collapsing?

    By A.G. Noorani
    Saturday, 27 Jun, 2009 | 02:07 PM PST |



    [​IMG]
    Indian Traders in Srinagar and drivers from Azad Kashmir
    acknowledge that armed forces of both countries have never
    hindered the flow of goods.—AP/File photo



    PRESIDENT Asif Ali Zardari spoke not a day too soon when, on June 9, he publicly emphasised the need for opening trade across the Line of Control in Kashmir. That it is on the verge of collapse is little known outside Kashmir or in the corridors of power in Islamabad and New Delhi.

    It was left to a weekly recently launched from Srinagar, Kashmir Life to publish, on April 25, a detailed reportage on its plight based on authoritative sources. The correspondents, Hamidullah Dar and R.S. Gull, are objective and fairly note the contrast between the dismal trade across the Jhelum Valley Road and the surge on the Poonch crossover at Chakan-da-Bagh.

    Their censure is justified and even-handed. ‘The pompous beginning of trans-LoC trade on October 21 last year has lost most of its sheen, leaving it for divided families to sustain the trade. Barring a few who visited Muzaffarabad personally and settled terms with their counterparts, most of the traders either deal only with their relatives living across the Line of Control (LoC) or seek a counter guarantee from relatives of traders in Azad Kashmir living here. Ironically, no state minister or district level administrator has visited the Trade Facilitation Centre at Salamabad to review the development of trade between two parts of Kashmir despite the media glare it witnessed on its initiation.’

    Left to the authorities the trade ‘would have vanished’ Sheikh Tariq, president of the Salamabad-Chakoti Traders Union remarked — ‘We suffered losses but continued only to sustain this opportunity of cross-LoC initiative’. It is valued for its significance and potentialities. In this 21st century it is trade by barter. There is no bank transfer facility and limited communication. More than 80 per cent of the traders involved have blood relations across the LoC.

    Till March 31, 2009, 180 trucks ferried 3,880 quintals worth Indian Rs1.77 crores from Salamabad to Chakoti in 21 consignments while 230 trucks carried 8,343 quintals worth Rs2.15 crores from Chakoti. The number of items permitted for this trade is limited to a measly 21. Screening is done manually with South Asian ineptitude. X-ray machines have yet to be installed.

    Traders in Srinagar and drivers from Azad Kashmir ‘acknowledge that armed forces of both countries have never hindered the flow of goods. Instead soldiers help do away with obstacles that traders face’. No prizes are awarded for guessing where the obstruction comes from. The evidence suggests that the honours are evenly divided between the two sides, neither of whom suffers from an excess of sensitivity.

    Mohammed Ashraf Wani, custodian of Salamabad’s Trade Facilitation Centre, draws attention to the fact that the traders are young and educated and represent each district of the Valley. ‘There is tremendous scope for unemployed educated youth in this trade. The government must pay attention to it so that more employment opportunities are provided.’

    In contrast trade at the crossing point in Poonch, Chakan-da-Bagh, surges every week to the gain of Jammu’s traders. It touched Rs7 crore in six months. The maximum number of families were divided in Poonch. Here, too, primitive barter prevails.A trade delegation from Azad Kashmir visited the Valley. Unfortunately visa was refused recently to one from Srinagar to Muzaffarabad. In the Valley, traders can receive calls from Azad Kashmir but cannot return the calls.

    All this was not only foreseeable but foreseen; most notably by a distinguished economist Dr Haseeb A. Drabu, chairman and CE of the J&K Bank, when the Azad Kashmir delegation met representatives of the J&K government in Srinagar. Five basic networks were necessary ‘for the cross-LoC trade to become a viable sustaining economic pro- cess’ he pointed out. They were — banking relations, including mutual acceptance of letters of credit; a communication network in order to enable traders to know the rates prevailing on the other side; transport network, regulatory network to determine the composition of trade and legal network for dispute resolution.

    ‘The fact is that we have done the glamorous bit; i.e. the front end. The back end, which is a critical thing, needs to be put in place. The success or the importance of this trade will be determined by how critically and how meticulously we manage these five mechanisms.’

    Dr Haseeb A. Drabu’s wry remark was apt. His prediction came true. As on the bus travel when absurd points were raised — UN document, passports, etc. — and an absurd procedure was devised, on trade also similar objections were raised, albeit sotto voce. Would it not imply recognition of the Azad Kashmir government, some Indians asked. Their Pakistani counterparts feared that it implied recognition of the LoC as the international border. Having lost their sleep on such fatuities, none cared to invoke the Simla Pact formula in Para 4 (ii): ‘Without prejudice to the recognised position of either side.’

    On Jan 15, 2009, at his first press conference after he became chief minister of the J&K government, Omar Abdullah noted ‘there is no exchange of money between the traders and no communication between the two parts of Kashmir’. On the same day he told a delegation of Kashmiri traders and industrialists, ‘I will ask New Delhi whether it is serious about cross-LoC trade. Otherwise it will be a pointless exercise’. If he has done so in these five months, it has remained his best-kept secret. The delegation had done its homework. It presented a 70-page memorandum on the difficulties. It represented an impressive array of organisations from the Chamber of Commerce and Industry to houseboat owners, the Shikara Union, to hoteliers.

    The president of the Federation of Chambers of Industries, Kashmir, Shakeel Qalander, remarked on Jan 29 that while Indo-Pak trade saw a surge despite the Mumbai blasts, LoC trade suffered in consequence.

    It would be a shame to hold LoC trade hostage to Indo-Pak politics and ignore the enormous good its liberalisation can do to the people on both sides; not least the unemployed youth in Kashmir. But then, of course, it is the land of Kashmir, the disputed territory, which matters. The people of Kashmir do not matter in the Indo-Pak cold war.


    The writer is a lawyer and author.


    DAWN.COM | World | Is LoC trade collapsing?
     
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  3. 1.44

    1.44 Member of The Month SEPTEMBER 2009 Senior Member

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    How can there be trade when no one trusts each other?Whatever Pakistan has to offer in trade we can make better,they're not China.
     
  4. Singh

    Singh Phat Cat Administrator

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    Look at India-China trade, the govt don't trust each other.

    The moot point is not if Pak can make it better, for eg. Sugar, Wheat, Cement, in all three India had/is having shortages and Pak makes excess of those and that too cheaply and so it is worth buying them from Pak.
     
  5. Yusuf

    Yusuf GUARDIAN Administrator

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    Trade is not just manufactured goods. There are lots of other items.
    Trade benefits Indian side more as we are superior in every respect to the Pakistanis in most sectors. India would have a good trade surplus with its trade with Pakistan if there was no bad history between the two countries.
    Indian goods still make it to Pakistan, albeit using the Dubai route.
     
  6. 1.44

    1.44 Member of The Month SEPTEMBER 2009 Senior Member

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    Yes but were not under constant terror attacks from China.The Pakistani terrorists kill hundreds of people and still they expect us to carry on trade with them and the Kashmir problem is brought to the fore in our every engagements.
     
  7. Daredevil

    Daredevil On Vacation! Administrator

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    The best trade that Pakistanis were doing with India was 'Terrorism'. If we are talking of collapsing of such LoC Trade, for now the answer is 'yes', in future what will happen, no body knows.
     

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