As politicians in South Asian countries start showing a willingness to overlook their differences to pursue common economic deals, Pakistan risks missing out, the Wall Street Journal reports.
India, which accounts for 80% of the region’s economic output, and Pakistan still do not seem able to find a way to put aside their feud.
And the tensions, along with Pakistan’s military-centric government, may lead to an increasingly integrated region leaving Pakistan behind.
“The United Nations estimates Pakistan’s official trade with India in 2013 at a measly $US2.5 billion,” WSJ reports. “Some economists estimate that it would be closer to $US20 billion if not for artificial restrictions.
India and Bangladesh are two of the region’s countries that have managed to resolve a long standing border dispute in order to pursue fruitful common economic endeavours and pledged to boost their bilateral trade.
Indian firms Reliance Power and Adani Power have recently committed an estimated $US4.5 billion to build power plants in Bangladesh, according to the Times of India. Reliance Power also signed a deal with Bangladesh Power Development Board for setting up a liquid gas-fired plant and a floating terminal, a total investment of $US3 billion.
India also loaned Bangladesh $US2 billion to improve their infrastructure.
Sri Lanka and India have also boosted their bilateral trade over the last ten years, quadrupling it to $US5.2 billion between 2003 and 2013.
Economic development seems to have become the focus point of the region, although India still needs to remedy its weak imports, as it exports much more to Sri Lanka and Bangladesh than it imports.
Pakistan, meanwhile, hasn’t joined the party.
Almost two years after India granted Pakistan a most favoured nation status, which under World Trade Organisation agreements prohibits any countries from discriminating between their trading partners, Pakistan has not extended India the same courtesy.
An added obstacle to the development of a Pakistani-India economic relationship is that generals rather than politicians are generally in charge of developing Pakistan’s relations.
And so although India is indeed losing from the current situation, it is not nearly as much as Pakistan does from continued isolation.
“Unless Pakistan switches tack, it risks remaining stuck in a demented South Asian time warp while the rest of region begins, at last, to look more like sensible Southeast Asia,” WSJ concludes.
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