India and Pakistan: Tomato diplomacy
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While diplomatic relations have turned frosty between the nuclear rivals, trade ties have borne fruit: tomatoes especially.
Sales of fresh tomatoes from India to Pakistan surged in the three months following the Mumbai attacks in November to more than $22 million – up from $4 million during the same time the previous year.
Wind storms squashed Pakistan’s tomato crop, explains Lahore merchant Qazi Tahir Ajman. He imports tomatoes and onions through the nearby Wagah border crossing. It took years of high-level negotiations to open Wagah in 2005 to trucks. Trade there has now crossed a record $30 million in the second half of 2008 and neither country seems to have the stomach to close it down.
“It’s not a surprise to me that trade hasn’t gone down because the routes are still open,” says Siddhartha Mitra, director of the Consumer Unity Trust Society in Jaipur, India. “People-to-people contacts will remain unless they are banned by law.”
Not everyone is so certain.
A survey of Indian businessmen after the Mumbai attacks found many too fearful to travel to Pakistan to talk shop. That led India’s chambers of commerce to predict last month that bilateral trade would drop some 60 percent. While that may yet happen, early data suggests not. Trade is up more than 11 percent in January and February of this year over last, according to Pakistani customs data.
Mr. Ajman, the Pakistani importer, says Indian traders still come and visits are friendly. “Government people from both countries don’t want peace. I don’t know why,” he says. “The ordinary people, we want peace. We want to live a better life.”
Some estimates suggest the countries are only realizing about 15 percent of their potential trade together, says Dr. Mitra. Restrictions are still so tight that a lot of trade unofficially goes through Dubai, United Arab Emirates, wasting lots of money and fuel, he says.
While the tomato boom shows the juicy potential for trade, it’s a highly perishable trend.
In agriculture, Pakistan protects its farmers from cheaper, subsidized Indian produce unless local prices get too high, says Shamoon Sadiq, head of Pakistan’s Horticulture Development and Export Board. But there are many items that involve less direct competition, say experts, including machinery and cut flowers from India, and leather, dates, and cement from Pakistan.
“We want to open up and keep doing trade. It helps to calm down a lot of things,” says Mr. Sadiq. “If there are business-to-business talks, there’s confidence building.”