As President Ebrahim Raisi is visiting Pakistan, both countries have agreed to set their sights on a much-needed trade boost to $10 billion. Of course, this is an ambitious target, but this is achievable and shows a strong desire to improve economic ties between the two neighbours. Sceptics call it all sunshine and roses. Not really.
Consider these points: the talk of a 10-fold increase in trade can be made a reality for both Pakistan and Iran. Both sides can tap into the mutual markets, exporting a wider range of goods. This translates to increased production, job creation, and a boost to both sides’ export sector. In a way, both Pakistani and Iranian consumers will benefit from access to more affordable products, triggering healthy competition in the market and potentially driving down prices.
Some significant challenges and real troubles await the stakeholders on their path to achieving this ambitious target. First and foremost are US and European trade restrictions mainly imposed on Iran. Here is where creativity and out-of-the-box approaches need to be triggered. Expanding designated border markets and exploring barter trade arrangements could be possible solutions.
Both sides will discuss a major sticking point in Pakistan-Iran economic relations: the Iran-Pakistan gas pipeline project. This multi-billion dollar project is a solution to Pakistan’s chronic energy woes. Unfortunately, the project remains in the virtual pipeline due to international sanctions on Iran. Pakistan time and again shows eagerness to complete the pipeline, but the threat of US sanctions on Pakistan for doing so looms large. This situation necessitates a firm stance from Pakistan. The US has allowed India to trade with Iran, a similar gesture should be shown for Pakistan.
The potential benefits of this increased trade cooperation are undeniable. It has the potential to create more jobs, lower the cost of living for Pakistani consumers, and introduce a wider variety of goods into the market. However, it’s crucial to remember that this is a new agreement, and significant time and effort will be required to translate these aspirations into reality. The Pakistani government must be proactive in addressing any hurdles and ensuring the smooth flow of trade.
Overall, the visit of the Iranian president marks a positive step towards a stronger economic relationship between Pakistan and Iran. While challenges exist, the potential rewards are significant. It is hoped this newfound enthusiasm paves the way for a more prosperous future for both nations. *