Pakistan seeks closer economic ties with Central Asia

Pakistan’s strategic location makes it a natural bridge between Central Asia and the Arabian Sea, connecting a landlocked region to world markets, the Pakistani magazine The News on Sunday (TNS) notes.

The Central Asian countries are of not only economic but also strategic importance to Pakistan, since the region has considerable economic potential, a growing consumer market and rich natural resources, and its strategic location makes it a vital hub between Europe and Asia.

According to the State Bank of Pakistan, Pakistan’s trade with Uzbekistan amounted to $145 million in 2020 and 2021, up from $45 million in 2015–2016. Pakistan’s trade with Kazakhstan and Kyrgyzstan also grew, reaching $36 million and $4.5 million respectively in 2020–2021. According to the World Bank, regional trade integration could increase Pakistan’s GDP by up to 1.7%, which, in the article’s author’s view, could create millions of jobs, improve the country’s economic position, reduce its dependence on traditional markets, strengthen Pakistan’s regional influence and widen its access to Central Asia’s natural resources, furthering economic integration in the region. The author calls this “a great opportunity knocking at Pakistan’s door”.

The article notes that Central Asia is connected to world markets by the Russian route, the Chinese route, the Iranian corridor and the Pakistani route through Afghanistan, but that the Pakistani direction is the most viable option for trade from Central Asia, offering shorter distances and modernised infrastructure (in Pakistan), given the China–Pakistan Economic Corridor (CPEC), and providing direct access to a large consumer market in South Asia.

Security uncertainty and the poor state of transport infrastructure and logistics in Afghanistan are negative factors on this route, so Pakistan and the Central Asian countries must work to remove these infrastructure shortcomings by simplifying trade rules and strengthening security cooperation, the author concludes.

https://www.thenews.com.pk/tns/detail/1256757-pakistan-and-central-asias-trade-renaissance