September 28, 2008crisisEconomyForeign Affairsforeign aidfree tradeIndiainternational communityPakistanSecurity

The time to drop barriers to trade with Pakistan

…is now

This is an archived blog post from The Acorn.

Pakistan’s economy is in a tailspin. Since the second last thing that the international community wants in Pakistan is an economic meltdown, Friends of Pakistan are coming together to provide emergency foreign aid.

Now how Pakistan’s western and Middle Eastern friends’ want to spend their money is their call. For India’s part, this is an excellent opportunity to liberalise bilateral trade, unilaterally if necessary. That’s why the Manmohan Singh-Asif Zardari meeting falls short: it just doesn’t go far enough on free trade.

Just how is Pakistan going to export more’ and import less’ in the medium term unless it expands trade with India? While there is some awareness in Pakistan that it will always need to rely on the charity of its friends’ unless it normalises its relations with India, the fact that such charity comes rather easily creates disincentives for Pakistan to drop its self-defeating approach to bilateral trade. Perhaps some friendly’ advice is in order.

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