Obama must support India-Pakistan rapprochement

For all of the bad news emanating out of South Asia – Afghanistan’s bleak prospects, the breakdown in US-Pakistani relations, and growing political instability in Islamabad – there is one heartening development: India and Pakistan have restarted their peace dialogue, which includes important moves toward greater economic engagement.

The Obama administration would do well to reinforce this effort, which, if it bears fruit, would have a very positive impact on US security interests in the region. Fortunately, Washington can do this with a modest level of funding that has already been authorized by Congress.

The annals of India-Pakistan relations are filled with numerous false dawns and the current moves could well founder upon the sharp historical animosities that regularly bedevil bilateral affairs. But things may be different this time.

Reports out of the Pakistani capital indicate that the government realizes it is in desperate economic straits and that closer ties with India constitute a much needed lifeline. The military establishment is also said to understand that the eastern border needs to be stabilized so resources can be focused on combating rising internal security threats.

Both countries just signed agreements this week that will further reduce barriers to bilateral trade. They have announced plans to double their two-way trade flows – to the $6 billion annual level – by 2015, ease visa rules for business travel, and open a new customs post at the Wagah border crossing that lies midway between Lahore and Amritsar.

The two countries also recently advanced several initiatives to enhance cooperation in the energy sector, including joint development of a natural gas field in Turkmenistan.

If deeper trade ties were to develop between South Asia’s largest economies, they would produce significant economic and (eventually) security dividends for the entire neighborhood. Despite common civilizational and historical bonds, the region today is remarkably fragmented economically.

Trade flows between India and Pakistan, for instance, represent a miniscule fraction of each country’s overall trade portfolio. Wagah is the only vehicle crossing along the 1,800-mile-long international border. The two-lane road there is only open a mere eight hours a day, and the cargo that passes through it must be unloaded and transferred to local trucks.

The pervasive barriers to bilateral economic cooperation have also spurred circuitous and highly inefficient trade patterns. A booming India requires cement for its construction sector yet is forced to import it from Africa instead of Pakistan, where the cement industry has excess capacity.

The United States can strengthen the current stirrings by launching a Marshall Plan-like initiative geared toward the expansion of cross-border economic linkages between the two countries. Funding for such a plan already exists.

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