Trade facilitation for economic corridors in South Asia: the perspective of Pakistan

Vaqar, Ahmed and Ghulam, Samad (2011): Trade facilitation for economic corridors in South Asia: the perspective of Pakistan.

Abstract

This study outlines the role of trade facilitation in Pakistan for economic corridors in South Asia. We study the current state of trade related infrastructure in Pakistan and its connectedness particularly with Afghanistan and India. The implications of recently initiated Afghanistan – Pakistan transit trade agreement are discussed. Current impediments in expanding trade relations with India are revisited. A perception survey reveals the issues faced by importers and exporters particularly those dealing with Afghanistan and India. We also held detailed focus group discussions where government functionaries and commercial counselors also participated. The policy recommendations are grounded in existing literature and survey results. The report has highlighted the required improvements in infrastructure arrangements to facilitate trade for fostering cooperation in South Asia between Pakistan, Afghanistan and India. However, trade facilitation also requires harmonizing customs procedures and harmonizing the regulatory framework of other controlling authorities at the border crossings. Linkages need to be established among the customs organizations of the respective countries to exchange data so that export document of one country could serve as the import document of the other country. The phytosanitary and other quality standard of the countries need to be exchanged and harmonized to the extent possible to eliminate the technical barriers to trade. Finally the relations between India and Pakistan must be broad-based and allow guarantee towards non-reversal of a liberalized bilateral trading environment. Towards achieving this objective governments on both sides must be helped by the business community and civil society. Pakistan must also realize that while additional investment in trade infrastructure is necessary for sustaining economic growth, an equal emphasis is required to address issues that keep the existing infrastructure underutilized. In its overall infrastructure score, Pakistan is almost in line with its regional competitors, however it fares poorly when it comes to organizing and managing the already available assets.

• Item Type: MPRA Paper
• Language: English
• Keywords: Trade facilitation, economic growth, economic corridors
• Subjects: F - International Economics > F1 - Trade > F15 - Economic Integration

References

Anson J., Cadot O and Olarreaga M (2003), “Tariff Evasion and Customs Corruption: does Pre- Shipment Inspection Help? World Bank Policy Research Working Paper No. 4258

Arvis F J, Raballand G, and Marteau F J (2007), “The Cost of Being Landlocked: Logistic Cost and Supply Chain Reliability” World Bank Policy Research Working Paper No. 4258

Banik N and Gilbert J (2008), “Regional Integration and Trade Cost in South Asia” ADB Institute Working Paper No. 127

Bhattacharyay N Biswa (2010), “Institutions for Asian Connectivity” ADB Institute Working Paper No. 220

Brook H Douglas (2008), “Regional Cooperation, Infrastructure, and Trade Cost in Asia” ADB Institute Working Paper No. 123

Brook H Douglas (2008), “Linking Asia Trade, Infrastructure and Logistic” ADB Institute Working Paper No. 128

Brook H Douglas and Stone F Susan (2010), “Accelerating Regional Integration: Issues at the Border” ADB Institute Working Paper No. 200

Calderon C and Serven L (2004), “The Effect of Infrastructure Development on Growth and Income Distribution.

Dennis Allen (2006), “The Impact of Regional Trade Agreements and Trade Facilitation in the Middle East north Africa Region”, World Bank Policy Research Working Paper No. 3837 Doing Businesses in Pakistan, 2010

De Prabir (2010), “Governance, Institution and Regional Infrastructure in Asia”, ADB Institute Working Paper No. 183

Economist Intelligence Unit, E-readiness ranking 2005, 2009, “The Usage Imperative: A Report from Economist Intelligence Unite

Gilbert J and Banik N (2010), “Socioeconomic Impact of Cross Border Transport Infrastructure Development in South Asian” ADB Institute Working Paper No. 211

Hausman H. W., Lee L. Hau and Subramanian U (2005), “Global Logistics Indicators, Supply Chain Metris, and Bilateral Trade Patterns”, World Bank Policy Research Working Paper No. 3773

Helble M., Shepherd B. and Wilson S. J (2007), “Transparency, Trade Costs, and Regional Integration in the Asia Pacific”, World Bank Policy Research Working Paper No. 4401

Hoekman B and Nicita A (2008), “Trade Policy, Trade Costs and Developing Country Trade”, World Bank Policy Research Working Paper No. 4797 46

Hoekman B and Zarrouk J (2009), “Changes in Cross Border Trade Costs in the Pan-Arab Free Trade Area, 2001-2008”. World Bank Policy Research Working Paper No. 5031

Njinkeu D., Wilson S. J and Fosso P. B (2008), “Expanding trade within Africa: The impact of trade facilitation”, World Bank Policy Research Working Paper No. 4790

Perez P Alberto and Wilson S John (2008), “Why Trade Facilitation Matters to Africa?”. World Bank Policy Research Working Paper No. 4719

Perez P Alberto and Wilson S John (2010), “Export Performance and Trade Facilitation Reforms: Hard and Soft Infrastructure”, World Bank Policy Research Working Paper No. 5261

Staples R B and Harris J (2009), “Origin and Beyond: Trade Facilitation Disasters or Trade Facilitation Opportunity? ADB Institute Working Paper No. 171

Stone F Susan (2008), “Asian Infrastructure Challenges: Issues of Institutional Capacity”, ADB Institute Working Paper No. 126

Shepherd B. and Wilson S. J (2008), “Trade Facilitation in ASEAN Member Countries: Measuring Progress and Assessing Priorities”, World Bank Policy Research Working Paper No. 4615

Soloaga I., Wilson S. J, and Mejia A (2006), “Moving Forward Faster: Trade Facilitation Reform and Mexican Competitiveness”. World Bank Policy Research Working Paper No. 3953

Waverman L., Dasgupta K., (2010), “The Connectivity Scorecard”, Consulting firm LECG and Nokia Siemens Networks

United Nations New York (2008), “United Nation e-Government Survey” Department of Economic and Social Affairs Division for Public Administration and Development Management

Wilson S. J., Mann L. Catherine and Otsuki T (2003), “Trade Facilitation and Economic Development: Measuring the Impact”, World Bank Policy Research Working Paper No. 2988

Wilson S. J., Mann L. Catherine and Otsuki T (2004), “Assessing the Potential Benefit of Trade Facilitation: A Global Perspective”, World Bank Policy Research Working Paper No. 3224

Wilson S. J and Otsuki T (2007), “Regional Integration in South Asia: What Role for Trade Facilitation? World Bank Policy Research Working Paper No. 4423