Workshop Abstract-Akbar Zaidi

ABSTRACT

TRADE AS A PRECURSOR TO PEACE WITH INDIA: EXPLORING POSSIBILITIES, IDENTIFYING CONSTRAINTS

S AKBAR ZAIDI*

Having fought two full-scale wars and numerous smaller battles, the two South Asian neighbours, India and Pakistan, now with nuclear weapons, consider themselves to be nuclear 'powers'. This, despite the fact, that both are amongst the poorest and least developed nations of the world. The unresolved Kashmir conflict is probably the biggest (or perhaps the only) issue which constrains normal relations between the two neighbours.

This paper argues that since it is improbable that the Kashmir 'issue' is going to be 'resolved' to everyone's satisfaction in the near future, it is perhaps important to consider other measures which can move the two countries towards better relations, and also, possibly, help in dealing with the Kashmir 'issue'. Normal economic and trading relations between the two countries is the route forward suggested in this paper. Moreover, there is a growing global trend of regional trading arrangements between neighbours as the advantages and benefits of such arrangements are substantial, yet South Asia is the only major world region not to move towards regional cooperation and integration. Especially for Pakistan, given its brittle economic situation, there seems to be no other option. The paper argues that even if trade and better economic relations between the two countries do not resolve or even address the Kashmir issue, they will certainly not make things much worse; this is a win-win situation. However, given Pakistan's political economy of defence and the praetorian nature of its state, with its huge vested interests, the prospects of a political economy of peace and of trade, seem rather remote. Nevertheless, if the grave situation facing Pakistan's economy is realized and narrow institutional interests are set aside and replaced by the larger national interest, there may still be some hope. Pakistan's very survival rests on this reorientation.

* TP-3, Block B, Fourth Floor, Mall Square, Zamzama Boulevard, Defense Housing Authority Phase 5, Karachi, Pakistan. Email: azaidi@fascom.com

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