Stabilizing the fragile economy of Pakistan through regional connectivity

Stabilizing the fragile economy of Pakistan through regional connectivity

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Intra-regional trade is vital for the entire region’s economic progress and to mitigate interstate conflicts. This is why Islamabad assigns great importance to the activities of regional organizations.

The Economic Cooperation Organization’s (ECO) 16th Summit, held in Tashkent, Uzbekistan earlier this month, germinated optimism about tapping landlocked Central Asian republics’ resources and stabilizing the fragile economy of Pakistan through regional connectivity. The theme of the summit was ‘Year of Strengthening Connectivity,’ a replica of ECO Vision-2025. It is also analogous to Pakistan’s economic concept, i.e., increasing economic cooperation among the Central, West, and South Asian nations to resolve their trade, financial, investment, and development challenges.

The ECO is an Asian political and economic intergovernmental organization established jointly by Pakistan, Turkiye, and Iran in 1985. Azerbaijan, Kazakhstan, Uzbekistan, Turkmenistan, Kyrgyzstan, Tajikistan, and Afghanistan joined in after the demise of the former Soviet Union. The organization’s objective is “contributing to the development of the member states, removal of trade barriers within the ECO region, and developing intra-regional trade and promoting the ECO region’s integration with global markets, strengthening cultural and historical ties among the member states.” The organization’s priority sectors of cooperation include energy, trade, transportation, agriculture, and drug control. Besides, the participants emphasized the sustainable economic development of member states.

During their speeches at ECO 2023, the leaders expressed their commitment to improving development, promoting trade and creating investment opportunities among the organization’s members. The shared cultural and historic affinities enable the member states to use the existing infrastructural and business links to further fortify their resolve to transfer their hopes and aspirations into a tangible reality.

Pakistani Prime Minister Kakar’s participation in the ECO summit reconfirms Pakistan’s commitment to the organization’s objectives. On November 9, while addressing the summit, Kakar emphasized regional integration to increase trade among member states. To facilitate intraregional trade, developments of roads, railway tracks, and port facilities are prerequisites. Besides, there is a need to liberalize visa regimes and simplify border procedures. Pakistan has developed physical infrastructure and advocates to streamline bureaucratic processes. Indeed, these arrangements enable the ECO countries to act as a bridge and create mutual interdependencies.

Pakistan provides six landlocked members of ECO with the shortest route to the sea

 Zafar Nawaz Jaspal

The Istanbul-Tehran-Islamabad (ITI) road corridor was a vital ECO initiative. In October 2021, Pakistan’s national logistics company trucks carried high value goods from Karachi to Istanbul via Iran. It was the first transport of goods through the ITI-ECO road corridor and holds immense significance in bolstering the ties of ECO members.

Pakistan’s Gwadar port is commercially attractive for ECO members as well, especially for Central Asians and Afghanistan. The port establishes unprecedented sea and road links between West Asia, South Asia, Central Asia, and Eurasia due to the development of the China-Pakistan Economic Corridor and Belt and Road Initiative projects in Central Asia. Thus, Pakistan provides six landlocked members of ECO with the shortest route to the sea.

The ECO has enormous potential to contribute to global trade. However, its trade volume is unimpressive because it contributes two percent to international and eight percent to regional trade. As a founding ECO member, Pakistan has always advocated for increasing interregional trade, connectivity, and economic cooperation. Therefore, PM Kakar recommended that the ECO reduce barriers to economic integration.

Pakistan-Uzbekistan bilateral cooperation is on a positive trajectory. Both sides aim to advance transport and communication engagement by constructing Uzbekistan, Afghanistan, and Pakistan railway tracks. Admittedly, this project can only be accomplished by improving Afghanistan’s political and security situation. Another obstacle in this project is the increasing mistrust between Kabul and Islamabad.

Although the war between Israel and Palestinian Hamas was not on the agenda of the summit, ignoring the genocide of the Palestinians was impossible for participants. The Middle East’s humanitarian crisis directly and indirectly impacts all member states.

While speaking at the summit, Prime Minister Kakar said, “I urge all ECO member states to push for a cease-fire in Gaza, support the call for the provision of humanitarian assistance, and rally efforts to hold Israel to account.”

In summary, ECO members can improve their interstate economic connectivity through the network of rail and road linkages, sea routes, and energy pipelines. In this context, Pakistan’s geography holds enormous promise for ECO members.

- Dr. Zafar Nawaz Jaspal is an Islamabad-based analyst and professor at the School of Politics and International Relations, Quaid-i-Azam University. E-mail: [email protected] Twitter: @zafar_jaspal

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