Daily Times

In the past few years, Central Asia has become a glaring example of global investment hub and a thriving center for collaboration in business and trade. Within the Central Asian States (CARs), Kazakhstan stands out as the economic and commercial heartbeat of this dynamic region. Since proudly declaring its independence in 1991, Kazakhstan has consistently captivated the world’s interest, attracting a whopping USD 320 billion in investments. This impressive figure accounts for about 70% of the overall foreign direct investment (FDI) flowing into the Central Asian Republics.

Pakistan and Kazakhstan actively engage in mutually beneficial collaboration across various sectors, encompassing trade, commerce, tourism, and culture. The warm shores of Pakistan’s Gowadar Port create a vital link for maritime trade, offering the most direct route between landlocked Kazakhstan and key regions like the Middle East, Africa, and the Far East. Kazakhstan, endowed with abundant energy resources, stands ready to fulfill Pakistan’s increasing energy needs. With a significant population of 240 million, Pakistan ranks as the 5th largest market, presenting a tremendous opportunity for importing a diverse range of goods from Kazakhstan, including construction materials, paint supplies, raw materials, foodstuffs, machinery, fertilizers, coal, and various metals. Additionally, Kazakhstan can import sought-after items from Pakistan, such as precious stones, fine jewelry, textiles, pharmaceuticals, agricultural products, fresh produce, footwear, leather goods, sports and medical equipment, and construction materials. This trade partnership holds immense potential for fostering prosperity in both nations.

Certainly, both Pakistan and Kazakhstan have made substantial progress in strengthening their economic collaboration. Although the current trade volume between two nations has surged to USD 138 million, it still falls short of its considerable potential. Kazakhstan’s Ambassador to Pakistan, Yerzhan Kistafin, has charted a strategic roadmap with a determined goal: to elevate bilateral trade to an impressive milestone of USD 1 billion. This ambitious target underscores a shared commitment of both brotherly nations to build a more prosperous economic partnership. That is why the activities in trade and commerce between Pakistan and Kazakhstan demonstrate significant development.

Since July 2023, a significant air corridor has been in operation connecting Pakistan and Kazakhstan, with the active coordination of both governments. The Kazakh airline Scat Air currently runs bi-weekly direct flights on every Tuesday and Friday, between Almaty and Lahore, providing travel convenience. The direct flights have gained popularity rapidly. According to the airline’s data, over the three months of operation, 2050 passengers (62% of the capacity) including businessmen, students, and tourists have traveled from Almaty to Lahore. Similarly, 1520 passengers (46% of the capacity) have journeyed from Lahore to Almaty. Additionally, the airline has transported 5000 KG of air cargo to the destination. The introduction of air cargo services by Scat Air is expected to significantly enhance trade and commerce between these nations. Recognizing the potential, Scat Air authorities plan to expand their network by introducing direct flights between Almaty and Karachi starting March 2024. Consequently, the air corridor linking Pakistan and Kazakhstan is poised to play a pivotal role in regional connectivity and economic cooperation.

Following negotiations with the National Logistic Corporation (NLC), Pakistan’s largest multimodal logistics company, Kazakhstan has recently dispatched a caravan of trucks on a new trade route through Afghanistan to Pakistan. The round trip covers a distance of 4000 kilometers, which is relatively short in the context of regional development. The Pakistani ports of Gowadar and Karachi act as connectivity bridges linking Central Asia, the Middle East, South Asia, and Africa. Pakistan and Kazakhstan maintain bilateral trade relations as members of the Economic Cooperation Organization (ECO), actively participating in various trade activities. Key traded items between the two nations include textiles, cotton yarn, rice, pharmaceutical products, oil and gas, minerals, and metals.

During the high-level forum “One Belt, One Road,” President Kassym Tokayev met with Pakistan’s Prime Minister, Anwar-ul-Haq Kakar, discussing current issues and the future prospects of their cooperation. Both nations have rekindled their engagement in sports as well. At the invitation of the Golf Federation of Kazakhstan, Pakistan participated in the international tournament “Zhibek Zholy CUP-2023” in Almaty from October 13-15. Kazakhstan secured the top spot, with Pakistan coming in second and Turkiye in third place. The golf federations of Pakistan and Kazakhstan have agreed to organize reciprocal visits in the future. In July, an MOU was signed at Kazakhstan House Lahore between the President of the Grappling Federation and the founder of the “Qazaq Batyry Martial Arts Academy,” Alin Kanat, and the General Manager of the “Sukh Chain Wellness Club.” The goal is to promote a healthy lifestyle and the development of martial arts in Pakistan. The embassy of Kazakhstan in Islamabad has established “Kazakhstan House” in Lahore to cater the growing demand of visa services for businessmen, tourists, students and other delegations.

To enhance regional connectivity, Pakistan has consistently focused on creating diverse trade routes. The China Pakistan Economic Corridor (CPEC), stretching from the Gowadar seaport in Pakistan to Kashgar in China, is intricately connected with the Quadrilateral Traffic & Transit Agreement (QTTA), involving China, Pakistan, Kazakhstan, and Kirgizstan. The 806 kilometers long Karakoram Highway of CPEC faces yearly blockage between Sust and Khunjerab (86 kilometers) from December to April due to extreme altitude and heavy snowfall. In a significant development, the National Highway Authority of Pakistan has collaborated with the Frontier Works Organization (FWO) to ensure the Karakoram Highway remains open throughout the winter season of 2023-24 for all types of cross-border transit trade. Consequently, the Karakoram Highway, serving as an alternative route to Afghanistan, has transformed into an all-weather passage. This strategic initiative marks a pivotal step towards fostering consistent and reliable trade connections in the region.

Both nations recognize the crucial role of a robust banking system in fostering the expansion of mutual trade and commerce. The Astana International Finance Center (AIFC) is in coordination with Yerzhan Kistafin to establish an Islamic Branch of a Pakistani bank at the AIFC. The ambassador of Kazakhstan has also engaged in discussions with the Presidents of Askari Bank and Alfalah Bank to explore opportunities for collaboration in the financial sector between the two countries.

Faisalabad city is the textile capital of Pakistan. In July, a Kazakh delegation visited factories in Faisalabad and observed the process of design development as well as the production of final products of clothing, bed linen and hosiery for the brands like “Bershka”, “Stradivarius”, “Zara”, “Massimo Dutti”, “Next”, “Adidas”, “H&M”, George”, and “Nike” etc. Another delegation of the Kazakh national clothing brand “Tarbiya” headed by T. Aidimbayeva visited “US Group” and “Nishat Mills Ltd.” the largest textile factories of Lahore where clothing and home textile for famous global brands such as “Levi’s”, “American Eagle”, “Polo”, Mango”, Hugo Boss”, “Kenzo” and “Tommy Hilfiger” etc. are produced.

In July, the inaugural gathering of the Kazakhstan-Pakistan Business Council took place, co-chaired by Ayan Yerenov, Chairman of the Board of the Foreign Trade Chamber of Kazakhstan, and Mehmood Ul Hasan Awan, representative of the Federation of Chambers of Commerce and Industry of Pakistan. The agenda centered around energizing overland and logistic routes, including the Trans-Afghan route and Karakoram Highway, fostering B2B connections, and identifying new and promising areas for collaboration. Notably, the meeting welcomed representatives from the Kazakh national investment operators “KazakhInvest” and “QazTrade,” further emphasizing the commitment to exploring mutually beneficial opportunities between the two nations.

The Pakistan Embassy organized the 2nd International Musical Festival “ALEM SAZ” in Astana, spanning from September 27 to October 03, 2023. This cultural extravaganza featured a captivating exhibition showcasing the rich art and culture of Pakistan. As part of the festivities, two Pakistani cinematic gems, “Parwaaz Hai Junoon” (Flying is Passion) and “Waar” (War), were screened, adding cinematic flair to the event. The Republic Day of Kazakhstan on October 25 was joyously celebrated with enthusiasm in Islamabad, Lahore, and Karachi, underscoring the vibrant camaraderie between the two nations.

The expanding trade and business ties between Pakistan and Kazakhstan stem from their unique strengths, longstanding historical connections, and the promising prospects offered by the Belt and Road Initiative. The forthcoming transit and trade agreement between the two nations will be instrumental in reaching the ambitious goal of a bilateral trade volume totaling USD 1 billion. This collaborative effort underscores the strategic alignment of interests and the commitment to fostering economic cooperation between Pakistan and Kazakhstan.

The writer is a senior banker based in Kazakhstan, with keen interest in Central Asian studies. He can be reached out at rafeeq_kz@yahoo.com.