Relations between India and Pakistan have been complicated and largely hostile due to many political and historical events. Relations b/w the two states have been defined by the violent partition of British India in 1947, the Kashmir dispute, and the numerous military disputes that were fought between the two nations. As a result, their relationship has been plagued with suspicion and hostility. Presently, after Jammu and Kashmir Reorganisation Bill, Pakistan cut off bilateral and trade relations with India, recalled the Pakistani ambassador to India, and exiled the High Commissioner of India to Pakistan.
With the exit of Great Britain in 1947 from India, two new sovereign nations were established—the Dominion of Pakistan and the Dominion of India. The subsequent partition of ex- British India displaced up to 12.5 million people, with several thousand loss of life. India emerged as a secular nation with a Hindu majority population and a large Muslim minority, while Pakistan with a Muslim majority population and a large Hindu minority later became the Islamic Republic. However, its constitution guaranteed liberty of religion to people of all faiths. It later lost most of its Hindu minority due to migration and after East Pakistan divided into the Bangladesh Liberation War.
Soon after their independence, Pakistan and India established diplomatic relations but the numerous territorial claims and violent partition would overshadow their relationship. Since their Independence, the two countries have fought three major wars, one silent war, and have been involved in numerous armed battles and military standoffs. The Kashmir dispute is the main center-point of all of these disputes except the Indo-Pakistan War of 1971 and Bangladesh Liberation War, which resulted in the isolation of East Pakistan (now Bangladesh).
What were the attempts to improve the relationship?
- The Agra Summit
- The Shimla Summit
- The Lahore Summit
The relationship b/w the two countries soured since the early 1980s
- the Siachen conflict
- the 1999 Kargil war
- Indian and Pakistani nuclear tests in 1998
- the intensification of Kashmir insurgency in 1989
Certain confidence-building measures are:
- The 2003 ceasefire agreement
- The Delhi–Lahore Bus service
The 2001 Indian Parliament attack brought the two nations to the edge of a nuclear war. The 2007 Samjhauta Express bombings, which killed 68 civilians was also a crucial point in relations. Additionally, the 2008 Mumbai attacks carried out by Pakistani militants resulted in a harsh blow to the ongoing India-Pakistan peace talks. Then terrorist attack in Pathankot and then attack in September 2019 and 2016 Pulwama attack further soured relations. India's claim that the attack had been planned by a Pakistan-supported jihadist group with proven evidence was denied by Pakistan.
Since 2016, the ongoing conflicts continued terrorist attacks and an increase in nationalist rhetoric on both sides has resulted in the collapse of bilateral relations, with little expectation they will recover. Particularly, following the 2019 Pulwama attack, the Indian government revoked Pakistan's most favored nation trade status, which it had granted to Pakistan in 1996. India also increased the customs duty to 200%, which majorly affected the trade of Pakistani cement and apparel. Both Pakistan and India are members of the South Asian Association for Regional Cooperation and its South Asian Free Trade Area. Pakistan used to host a pavilion at the annual India International Trade Fair, which drew huge crowds. Worsening relations b/w the two nations resulted in a boycott of Pakistani traders at the trade fair.
In November 2015, the new Indian Prime Minister of India, Narendra Modi, and Pakistani Prime Minister Nawaz Sharif agreed to the resumption of bilateral talks. The next month, Prime Minister Modi made a brief, unscheduled visit to Pakistan while en-route to India, becoming the first Indian PM to visit Pakistan since 2004. Despite those efforts, relations b/w the countries have remained frigid, following repeated acts of cross-border terrorism. In August 2019, after the Indian Parliament approved the Jammu and Kashmir Reorganization Bill, which revoked the special status of Jammu and Kashmir, further tension was brought between the two countries with Pakistan upgrading its diplomatic relations, Closed airspace, and postponed bilateral trade with India.
The Composite Dialogue b/w Pakistan and India from 2004 to 2008 addressed all issues. It had accomplished four rounds and the fifth round was in progress when it was paused in the wake of the Mumbai terrorist attack in November 2008.
|344.59 million $
|2.23 billion $
Trade Relations b/w India and Pakistan
India-Pakistan Trade Relations are supported by the Federation of Pakistan Chambers of Commerce & Industry (FPCCI) and the Federation of Indian Chambers and Commerce (FICCI). FPCCI and FICCI are the representatives of the business and trade community of their respective countries. The main objective of these two chambers of commerce is to facilitate trade and business opportunities between India and Pakistan. Their common goal is to increase ethical business activities within all South Asian nations and between each other.
India-Pakistan trade relations focus on:
- Trade contracts
- Trading policies
- Trading procedures
- Business networking for trade
- Trade and investment opportunities
- Trade administrative and regulatory procedures
India-Pakistan trade policies of India
- Simplification of duties and levies on inputs used in export products.
- Simplification of legal and commercial procedures and bringing down transaction costs.
- Facilitating development of India as a global centre for trading, manufacturing, and services.
- Eliminate government controls and creating an atmosphere of transparency and trust to promote industrialization, entrepreneurship and trades.
- Neutralizing inverted duty structures and ensuring that India's domestic sectors are not disadvantaged in the Free Trade Agreements/Preferential Trade Agreements /Regional Trade Agreements that India enters into, in order to enhance exports.
- Facilitating infrastructural and technological up-gradation of all the sectors of the Indian economy, especially through imports, thereby
increasing productivity and value addition, while attaining global standards of quality.
Involving Indian Embassies as a chief member of the export strategy and linking all commercial houses at international locations through an electronic platform for real-time inquiry, trade intelligence, and information distribution.
On the other hand, Pakistan's policies in trade with India are not satisfactory. Pakistan gives many waivers to China-based companies for trade and investment but hampers India-Pakistan trade relations. Even create a problem in India-Afghanistan trade and does not give route access in the name of security. Pakistan still does not give MFN status to India even though India granted this status much before under International obligation. Even, the route for trade in Kashmir is used by militants to build arms for terrorists and a channel of funds. So there is no improvement in trade relations between neighboring countries.