[ALOCHONA] Ties with Dhaka

Ties with Dhaka By Ikram Sehgal The trauma of 1971 saw hardly any direct interaction between Pakistan and Bangladesh for a few years. Other countries moved in to fill the resulting vacuum. This, in fact, corrected some serious anomalies. All countries of the world must interact with countries on their periphery or in their proximity. Pre-1971 Pakistan aligned itself more with the countries to the West, both politically and economically, and did not take initiatives to capitalise on the proximity of (then) East Pakistan with South-East Asia, or with India. Bangladesh has corrected this. It has strong political and economic ties with its neighbours. In fact, Pakistan and Bangladesh have both independently increased manifold their individual relationships with India and with the GCC countries. The South Asian Association for Regional Cooperation (SAARC) is an excellent engine for regional integration. The focus presently is on bilateral relations. Because of its size, economic strength and geographical location, India is in its own orbit. Since India has porous borders20with many of the SAARC members, its trade with its neighbours is a natural phenomenon. Pakistan and Bangladesh need to develop their mutual ties while remaining distinctly independent. The two wings of Pakistan had "complementary" economies. Similarity between the two countries in the realm of foreign policy makes it hard to discern differences. While independent forming of views must follow its natural course, there must be regular consultations with each other. The most lasting relationship between any two entities is always economic, the thread of a binding fabric. Closeness is possible by some simple uncomplicated initiatives. Countries of the Third World have perennial problems with their exports, the "protectionist" tendencies among the countries of the developed world mean they all want to export out to you and take almost nothing in return. Trade volume between Pakistan and Bangladesh has increased sharply from $166.9 million in 2000-01 to $320.2 million in 2006-07. This is just the tip of the iceberg. A trade potential of over $1.5 billion exists between Pakistan and Bangladesh. Bottlenecks restricting the exchange traditional items in demand in each other's countries must be removed. Among goods that Bangladesh can purchase and Pakistan can export freely are raw cotton, cotton yarn and finished and unfinished textiles. From time to time, Bangladesh also needs rice and urea fertiliser (when it is not exporting them). Bangladesh remains in short supply for cement, sometimes surplus in Pakistan, and=2 0can take in more cement plants, sugar plants, textile machinery, etc. Bangladesh can sell to Pakistan raw jute, jute goods and tea. The third largest jute industry in the world is in Pakistan, they all reply on imported raw jute from Bangladesh, not an economically feasible undertaking. Jute goods can be acquired from Bangladesh at half the cost that they are produced in Pakistan, electricity and water thus spared can be utilized elsewhere. This increased cost in jute goods prices translates into higher cost for food items in Pakistan. Pre-1971 the former East Pakistan had almost a 100 percent monopoly over tea imports by the former West Pakistan. Pakistanis preferred the thick, low-grown Bangladeshi tea. Cooked along with sugar and milk it was a poor man's food supplement. Today, the monopoly of some multinational corporations (MNCs) in Pakistan has ensured that the cheap Bangladeshi tea is replaced by expensive Kenyan tea (at four to five times the price from Bangladesh), from gardens in Kenya that are owned by these MNCs. What Kenya buys in return from Pakistan for sales of tea worth hundreds of million dollars is next to nothing. The increase in trade will also give a tremendous boost to the shipping industries of the two countries. Strengthening of people-to-people contact requires initiatives that will remove psychological barriers stunting the present relationship between the two. The first initiative is complete removal of all tariffs, a force-multiplier for bilateral trade. The imposition of tariffs=2 0doubles the price to consumers in both countries; with negative impact on trading activities because of which consumes in both countries suffer. Preponderance of the tariff barriers contributes to diversion of trade to unorganised channels providing a boost to unofficial trade, mostly from third countries. Lower prices will give consumers wider choice at competitive prices. It will lower costs throughout the economy. This will also lower inflation; lower input costs for export industries; and act as a catalyst for improved productivity. The second initiative is for the two nations to work out an arrangement for inter-changeability of their respective currencies. If Pakistan wishes to import a commodity from Bangladesh, it can pay for it through a bank in rupees (at the prevailing exchange rates). Similarly, Bangladesh can pay for its imports from Pakistan using the taka. Just consider, if there is no tariff and interchangeability of currency a packet of tea that sells without any tariffs for 100 takas in Bangladesh will also sell in Pakistan at 100-plus takas with freight at actuals (or the equivalent in Pakistani rupees)! The third initiative is to remove all visa restrictions between the two countries. This is essentially a calculated risk, which must be taken. Currently there are an estimated 1.6 million Bangladeshi nationals residing in Pakistan, most of them illegally. A majority cannot go back to Bangladesh because they do not have legal documents; in the meanwhile, the lure of Pakistan continues to draw s cores of Bangladeshi nationals via illegal channels. There is also the question of "stranded Pakistanis" in Bangladesh. They belong in Pakistan. Let the law of nature take its full course and give them their rightful place in the Pakistani sun. This represents a moral blot on our national character that must be removed. Given traditional and safe routes of sea and air in contrast to the rigour and risks of travel across India (as well as the money paid to human smugglers for arranging passage), a vast majority of aspirant immigrants would opt to choose legality. Economics will dictate the natural course of events, the "demand" and "supply" for migrant workers dictating the volumes of migration. Increased travel will open up a new source of revenues for the government, giving a tremendous fillip to the services industry to cater for the increased number of visitors. Visitors from each other's countries will energise the retail markets in the key cities of Karachi, Dhaka, Lahore and Chittagong. Consider what this will do for PIA and Bangladesh Biman. Let us at least start with allowing "visas upon arrival" at airports. While no one can really turn the clock back on 1971, one must look to the future instead of staying mired in the complications of the past. One should not try and make Bangladesh into Pakistan, and vice-versa. Why not make our relationship so that Bangladesh is Pakistan by another name and Pakistan is Bangladesh by another name? The people of Pakistan and Bangladesh can renew=2 0their close ties to the level they once existed, not as a federation or even as a confederation, but as two independent sovereign nations. --------------------------------------------- The writer is a defence and political analyst. Ikram Sehgal E Mail : isehgal@pathfinder9.com http://newsfrombangladesh.net/view.php?hidRecord=228622

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