Reporting Pakistan

by Meena Menon

  The Pakistani leadership was not spared either. Merely repeating that Kashmir was the jugular vein of Pakistan was not enough, he yelled—that jugular vein had to be got back. He was not for enmity or aggression but at the same time if India insisted that Kashmir was its integral part, then it would be torn from limb to limb. He said it was not terrorism to take away one’s right, and if there has to be talks, remember the Kashmiris. He also stated that talks wouldn’t resolve issues as in the case of the drone strikes which were ongoing even after talking to the US.

  Members from the Difa-e-Pakistan Council were also present: Hamid Gul, the former ISI chief, his son Ayaz, Ijaz-ul-Haq, the son of Zia, and Maulana Samiullah. All of them were competing with each other in their abuse of India. The meeting went on till 10 p.m.

  I had often attended Saeed’s meetings and listened to his volley of abuse, which seemed quite the norm. He was allowed to visit Balochistan after the earthquake in Awaran, and distribute relief materials alongside the army, and he called a colourful press conference to inform us of the relief work the Falah-i-Insaniyat had been carrying out in Mastung and other regions.

  In order to project his humanitarian side, after a report that India and the US were working together to stop funds to terror groups, Saeed conducted a media conference sitting in the middle of sacks of food, plastic water cans, Star Wars games and clothes meant to be Id gifts for the people affected by the earthquake in Balochistan. Again, he blamed India for the unrest in Balochistan and said that there were absolutely no problems there otherwise. He said his organization didn’t take money from the Pakistan government and his entire funding was from the people who believed in his work; his organizations were registered with the government and the accounts were audited regularly. After the Mumbai attacks, there were US sanctions on his organizations, and bank accounts were frozen. ‘We challenged it in the courts and even in the high court I got relief. India had also presented some proof, but the high court cleared me and the JuD . . . and later this also came up before a full bench of the Supreme Court which also cleared me,’ he said. Now no one could stop the JuD from doing its humanitarian work, he exulted. The Punjab government, in a fit of generosity, had donated PKR 61 million to the JuD in 2013, and the adviser on national security, Sartaj Aziz, in response to a question I asked him at a press conference, defended the JuD, saying that it was a social work organization. In 2012, the US had announced a $10-million reward for information leading to his capture, and the JuD has sanctions imposed on it by the United Nations Security Council. It is also on the list of banned organizations in Pakistan. However, in 2009, Saeed’s detention in the 26/11 case was set aside by the Lahore High Court which did not find any evidence linking him with the terror strike.

  Kashmiris throughout the world observe 27 October as Black Day to mark the day in 1947 when the Indian forces entered the Kashmir Valley. The All Party Hurriyat Conference (G) Chairperson Syed Ali Geelani addressed a public meeting in Islamabad over the telephone and said the United Nations had failed to give the right of self-determination to Kashmiris through a plebiscite. He said the Kashmiris did not accept the Indian occupation, and they should be given the right of self-determination.

  Protestors also thronged D-Chowk with large placards calling for an end to the bloodshed in the valley. Professor Waqar Ashraf, one of the participants, said that freedom was a right wherever you lived and the Kashmiris should be given that right; they could not be forced to live in a country they did not wish to belong to, and even the United Nations Charter is against it.

  The human rights violation in Kashmir was another central issue. Support for the Kashmiris also came from the PTI led by Imran Khan. Dr Shireen Mazari, the PTI central information secretary, said that 27 October was marked as a Black Day when India occupied Kashmir and denied its people their right to self-determination in accordance with the United Nations Charter and the Independence principles that created the two independent states of Pakistan and India in August 1947. I used to meet JKLF founder Amanullah Khan at press conferences and he always remembered my predecessors, including Anita Joshua, fondly. His health was failing even then and he passed away in 2016.

  Kashmir is a central issue for both countries, and the rights of the people to determine their status have been wantonly ignored. Training and arming youth or waging jihad has not yielded results just as armed occupation and repression have not. Unrest and unhappiness continue to loom over the region, as a peaceful solution is kept at bay with great determination by the powers that be of both countries. In this monumental mess, other issues like the MFN, Siachen, Sir Creek, LoC trade, and the arrest of fisherfolk, although important, fall by the wayside.

  The MFN muddle and the trade deadlock

  Just when things were more or less certain on the MFN status and the commerce minister, Khurram Dastgir Khan, was to make a trip to India in January 2014, there was a change of plans. Dastgir granted both the Indian correspondents interviews before his departure, and was full of optimism. In March 2014, Sharif, who for some reason made important announcements when he was not in Pakistan, had us all scrambling when he said in The Hague that Pakistan had postponed granting India MFN status (on 23 March 2014). He was attending the third International Nuclear Security Summit and told the media that there was no consensus on granting India MFN. The federal Cabinet was slated to meet in mid-March 2014 and approve the MFN status to India, but it did not happen. There was a move to rename the MFN and make it non-discriminatory market access (NDMA), as Dastgir had said in his interview to The Hindu in January 2014. But this rose by any other name was as much of a problem.

  The federal government was prepared to bypass reservations expressed by the local industry and farmers, and give non-discriminatory market access to India which would provide a benefit of PKR 550–600 billion to the country’s economy. ‘India has given clear indication to accept Pakistan’s two main demands of accommodating exportable items and removing additional duties within six months, which has paved the way for Islamabad to grant the NDMA status to New Delhi,’ said a top official of the commerce ministry, wishing not to be named.

  The local automobile, pharmaceutical industries as well as farmers have serious concerns over the government’s decision to grant the MFN status to India. How can India be a favoured, or even worse, the most favoured nation? That sticks in the gullet of many. But there are also real fears on the ground. Thousands of Pakistani farmers had threatened to stage a sit-in at the Wagah border from 31 March 2014 onwards for an indefinite period against Islamabad’s decision to grant NDMA to New Delhi. The Pakistan Kisan Ittehad president, Khalid Mehmood Khokhar, said in a press conference that India had already controlled the waters flowing into Pakistan, and now it wanted to control the agriculture of Pakistan. The farmers of the country would not accept this trade, he warned. Farmers’ groups felt India would have an unfair advantage as it had subsidies for agriculture, while Pakistan did not.

  Trade was currently in India’s favour as Pakistan’s exports were only $350 million against imports of $1.8 billion. The Indian government granted the MFN status to Pakistan in 1996. But non-tariff barriers remained intact on exports from Pakistan, and both sides did not make much progress towards trade liberalization. Later, Pakistan announced in October 2011 that it would grant the MFN status to India from 1 January 2013 by converting the negative list into a positive one by the end of 2012, a step that would have automatically granted the MFN status to India. However, Pakistan failed to grant it before 31 December 2012.

  During my earlier visit to Pakistan in 2011, our group had met a lot of Pakistani businessmen who dispelled the notion that granting the MFN to India would adversely affect Pakistan. They were eager for trade. Importing products from India would be cheaper and better, and one of them was optimistic about the huge volumes of trade. Instead of spending on the army, the government should focus on improving trade and business relations, said another businessman. In Karachi too, there was much discussion on
the MFN, and hoteliers like Dinshaw Avari, the director of the oldest five-star hotel there, favoured the MFN status which would help hotels get cheaper and better-quality sanitaryware and lifts, and this would be a good exchange for Pakistani businesses.

  But these sane voices seemed to be drowned out by the shrill ones in Parliament. When I was there, I heard strong opposition from political parties to the MFN, with Dastgir Khan, vainly trying to defend his position. Earlier, Sharif had used the General Elections in 2014 in India to postpone the decision since he didn’t want to favour any political party. Provisionally, Pakistan was committed to giving India the MFN status in 2012, but the commerce ministry had not come up with a roadmap to see it through. That was also the time when tensions on the LoC were not subsiding.

  It was not only tensions on the LoC but also some much-needed groundwork that held up Pakistan completing the process of granting the MFN status. Though trade continued to be normal between the two countries, there was a reluctance, later attributed to the Pakistan Army, to give India the full honours. In the National Assembly when I attended and reported sessions on 26 and 27 September 2013, Pakistani ministers often said that the granting of the MFN status for India would be a top priority and that it had been agreed to in principle, but only after the composite dialogue resumed and tensions on the border were resolved.

  While the federal Cabinet had approved the MFN status for India, the ministry of commerce was directed to bring out a summary on how complete normalization of trade could be achieved and how India could create a level playing field, according to sources who were part of this discussion. However, the ministry did not get back to the Cabinet. It should have ideally created a roadmap by February 2014. Apart from the issue of non-tariff barriers, the whole ambit of trade relationships would have to be clarified. Since January 2014, Indian and Pakistani soldiers have been killed on the LoC, creating tension and stalling dialogue.

  In the National Assembly discussions, the government also said it wasn’t aware that the IMF was putting a condition on the MFN to India for the loan it approved for Pakistan. Many members strongly opposed granting the MFN status to India, fearing it would have repercussions in their political constituencies.

  A written reply to a question in the National Assembly in September 2013 was full of details. The federal Cabinet, in its meeting held on 2 November 2011, endorsed the efforts of the ministry of commerce for full normalization of trade relations with India and directed the commerce division to complete the process. On 29 February 2012, the Cabinet approved a negative list of 1209 items for import from India, replacing the positive list. The Cabinet also approved, in principle, the phasing out of the negative list by 31 December 2012, subject to creating a level-playing field for Pakistan’s exports to Indian markets. However, the ministry could not meet the timeline as it was consulting the government and private sector stakeholders to evaluate the level playing field enjoyed by Pakistani exports to India, the non-tariff barriers being faced by Pakistani exporters and issues of market access of Pakistani products to India. The elimination of the negative list after the approval of the Cabinet would imply the granting of the MFN status to India.

  Once India is granted the MFN status, trade costs will be reduced due to availability of raw materials; machinery will be available at cheaper rates, and freight charges will be lowered. This will help give a positive edge to the overall competiveness of Pakistan. Consumers can buy goods at competitive rates, and Pakistan will gain access to a large Indian market. Also, linkages with the Indian market will improve access to better entrepreneurial, marketing, production and distribution practices, the reply said.

  In 2009–10, the exports to India stood at $268.332 million and imports $1225.567, while in 2012–13, it was $271.089 million (exports) and $1568.750 million (imports). The government is keen on increasing this substantially. In 2013, Pakistan and India signed three technical agreements and discussed trade in gas and electricity. The agreements on redressal of trade grievances, mutual recognition and customs cooperation will facilitate bilateral business mechanisms and ease issues relating to certification, licensing and lab testing. The two sides agreed to a number of specific steps and timelines for implementing the agreements. However, the question is if there has been any movement on these matters.

  The MFN status is not fully realized yet and will continue to remain another thorn in the fraught relations between India and Pakistan. The Sustainable Policy Development Institute produced a paper30 on the informal trade between the two countries which totted up to $4.2 billion a year, and trade is conducted through informal couriers in a systematic way. Given the large volumes of informal trade, it is in the interest of the Pakistan government to move fast and adopt measures that lead to formalization. Pakistani producers end up competing with items that are not duty paid and are cheaper in the local market. There is also a loss of revenue to the government as these goods are not subjected to usual customs procedures. Food, herbs and pharmaceutical items are not checked for health and safety standards, posing a risk to human health. The key sectors in which informal flow from India is taking place include fruits and vegetables, textiles, automobile parts, jewellery, cosmetics, medicine, tobacco, herbal products, spices and herbs, paper and paper products, as well as crockery. The major routes from where these goods are channelled into Pakistan include Dubai, Kabul, Kandahar, Chaman and Bandar Abbas. The minor routes include several places in the adjoining border region.

  As there’s a fascination for Indian clothes, I was not surprised to find that in the wholesale markets in Karachi, Lahore and Rawalpindi, there are around 400 shops which are dealing in Indian cloth, fancy suiting and bridal wear. The price of a sari dress ranged from $50–150 and the price of an Indian bridal dress ranged from $800–1600.

  The daily turnover in Indian medicine, as reported in Khyber Pakhtunkhwa province and tribal areas on the Afghan border, was $0.15 million, and the daily turnover in Indian medicine reported in Lahore was $15,000. The monthly turnover from spices was reported at $0.7 million, while the monthly turnover from Indian black tea coming through Afghanistan was calculated at $0.1 million. Even betel leaf comes from India, and on an average the monthly consumption of betel leaf was reported at 0.3 million kilograms in Lahore alone, while the monthly turnover in banned items like gutkha and Pan Parag was reported at $0.40 million. There are a number of shops dealing in Indian auto parts in Karachi, Lahore and Rawalpindi. The average monthly turnover of each shop was $0.1 million in Karachi, $0.25 million in Lahore and $0.12 million in Rawalpindi; the market share stood at around 30 per cent. The total annual turnover in tyres was around $243 million and the market share of retreaded Indian tyres locally was around 70 per cent, i.e. $170 million.31

  The major engine parts are already imported from China, whereas from India, traders are mainly importing gearboxes of different cars through the Wagah–Attari border. The auto parts imported from India were cost effective and better quality compared to China, the study notes. Cosmetics, herbal products and alcohol too were popular, but on the flip side the study finds that the fear expressed by some Pakistanis was justified. This informal trade in items such as auto parts was crippling the local industry, and while granting the MFN status to India, the SDPI said Pakistan should ensure that both tariff and non-tariff barriers came down to a level where formal trade became more attractive.

  LoC trade stalled again

  The cross-LoC trade between India and Pakistan came to a standstill after a Pakistani driver was arrested for allegedly carrying brown sugar in a consignment of almonds, on 17 January 2014. When the driver didn’t come back, the Pakistan side of the LoC closed entry and trucks were stranded on either side for nearly a fortnight. Pakistan demanded the release of the driver as he could not be arrested since he enjoyed diplomatic immunity, but India refused to budge. Instead of arriving at a mechanism to resolve this impasse, there was much mudslinging and it took nearly a month for the matter to be ironed out, and I am not
sure it was to the satisfaction of both parties. Pakistan raised doubts about the media being present during the arrest and it felt the driver could be innocent. Cross-LoC trade began in 2008 at Salamabad in Uri and Chakan da Bagh in Poonch district with two trade facilitation centres, and it was an important CBM. Reporting this incident included putting together a combination of inputs from Srinagar, where The Hindu’s Ahmed Ali Fayyaz was best placed to file, and New Delhi, and I could only relay what the Pakistan foreign office was saying. A meeting of the Pakistan–India Joint Working Group (JWG) on Cross-LoC CBMs was held in March in New Delhi and the fact that it met after a gap of nearly one and a half years speaks volumes for the priority such mechanisms have. At a briefing on 6 March 2014, the Pakistan foreign office spokesperson said the meeting was constructive, but raised questions over India’s jurisdiction and jurisprudence. It wanted the driver’s release and said all such matters should be dealt with at the local level.