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Pakistan-Kazakhstan Bilateral Relations: A Strategic Road Map
Dr. Mehmood Ul Hassan Khan
10 Mart 2020 15:10
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Despite ongoing political regional rivalries, sever economic competitions/hurdles/barriers and social chaos the friendship between Pakistan and Kazakhstan have been exemplary since the establishment of formal diplomatic ties. Both the countries have been relishing bilateral relations based on mutual respect, cooperation and economic integration.

Paradigm Shift in Central Asia

There is a paradigm shift in Central Asia to further enhance regional connectivity through greater regional cooperation and socio-economic integration due to which there is an urgent need that both the countries must “institutionalize” all possible measures to further strengthen their bilateral relations by taking full advantage of their better political understanding to enhance cooperation. Expected “peace deal” in Afghanistan may be a “game changer” for the rest of the region and may open a “new gate” of “unlimited opportunities” of mutual cooperation, coordination and collaboration in diverse fields between the two countries. 

Despite historic bounding and similarities of heritage and culture, persuasion of rigorous commercial diplomacy is the need of the hour. In this connection both countries have already prepared a “road map” aimed at further “diversifying” and “intensifying” the Pak-Kazakh bilateral economic cooperation.

Strategic Road Map

Being prominent regional expert of Kazakhstan & CIS I submit that “strategic road map” must be based on a set of measures, which may push forward volumes of bilateral trade and investment cooperation in the days to come. Both countries have more than 35 MOUs in different fields which need to be reevaluated to achieve optimal levels of operationalization and channelization for the further strengthening of socio-economic cooperation. 

Historic Perspectives

Pakistan was among the first few countries which recognized Kazakhstan when it attained independence in December 1991. Subsequently, diplomatic relations/ties between the two countries were established in 1992. Pakistan took the initiative and the first Prime Ministerial visit took place in 1995 followed by second Prime Ministerial visit in 2011. President of Pakistan visited Kazakhstan in 2011. Moreover, former Prime Minister of Pakistan Nawaz Sharif also visited Kazakhstan in 2015. Former Kazakhstan President Nazarbayev visited Pakistan twice in 1992 and 2003. Several Parliamentary and Ministerial as well as high level officials also exchanged visits.

Pak-Kazakh Befitting Propositions

 

In addition to the above mentioned diagram, Kazakhstan also supported Pakistan’s candidature to UNESCO Executive Board (2015-2019) and journey of mutual trust, harmony, political consultations and economic cooperation is getting momentum with the passing of each day.

 Strategic Orientations

 

Pak-Kazakh Horizon of Diplomatic Relations

The scope and horizon of diplomatic relations between the two countries are diversified and dynamic due to which right from the beginning both the countries have been sharing better political understandings include various official mutual visits of their leadership and cooperation and meaningful coordination within various international organisations i.e. the United Nations (UN), the Organization of Islamic Cooperation (OIC), Economic Cooperation Organization (ECO), Shanghai Cooperation Organization (SCO) and Conference on Interaction and Confidence-Building Measures in Asia (CICA). Moreover, Pakistan provides natural link to connect the Eurasian region with the Arabian Sea and South Asia.

Pakistan also offers the critical over land routes and connectivity for mutually beneficial trade and regional energy cooperation. Whereas Kazakhstan is an integral part of Central Asia Region (CAR) connected with ancient links with South Asia. Pakistan attaches great importance to building enhanced trade relations with Central Asian Republics, especially Kazakhstan. Being prominent regional expert of Kazakhstan & CIS I, hope that through diversified land routes and integrated trade agreements/mechanism both the countries can explore unlimited untapped potential that would be mutually beneficial in the days to come.

Bilateral Trade & Possible Means

Since Kazakhstan is the biggest land-lock country of the world having no direct road, rail, sea and air links with Pakistan so it is strongly recommended that both countries should focus on some “innovative plans” to enhance their levels of connectivity in the future. Strong political commitments and inclusion of private sectors may be useful to achieve the desired goals of socio-economic integration and greater regional connectivity.

Lack of direct geographical communications seriously hamper bilateral economic and trade cooperation and coordination. But through serious initiatives the volumes of bilateral trade may be increased. Pakistan’s access to western China and Central Asia has been greatly expanded by the reconstruction and renovation of the strategically Karakoram Highway in the 2000s which may be utilized to enhance regional connectivity.

 

CPEC: A Regional Integration

In this connection, Pakistan is also interested to strengthen bilateral relations with Kazakhstan through the development of the China-Pakistan Economic Corridor (CPEC) and other various connectivity projects which would ensure regional development and prosperity. Pakistani ports offer the shortest land route to Kazakhstan for access to the Arabian Sea which can be mutually beneficial for both countries.  

Both countries may extend their cooperation in the field of energy such as oil and gas, civil nuclear cooperation and renewable energy. The CGSS Pakistan suggests that the two sides should consider utilizing the potential links between Islamabad and Astana through connection of railways Kazakhstan-Turkmenistan-Iran and Pakistan-Iran-Turkey. It would be very much in line with Kazakhstan’s New Economic Policy ‘Nurly Zhol’ and China-Pakistan Economic Corridor (CPEC) project. Moreover enhanced people to people contact on regular exchange between organisations, artists, research centers, educational institutions and mass media may intensify cooperation in the fields of education, research, science, culture, art, tourism and sports.

Potentialities & Possibilities

 

Mutual Cooperation in Textile, cotton products, pharmaceuticals, and food items, engineering equipment and machinery, and construction enterprises

It is strongly recommended that both countries must take initiatives to enhance trade and investments in textile and cotton products, pharmaceuticals, and food items, engineering equipment and machinery, and construction enterprises. Pakistan and Kazakhstan signed three memoranda of understanding (MoUs) for cooperation in the areas of trade and investment, defence and strategic studies, and training in foreign services which needs to be institutionalized as soon as possible.

Trade Statistics (2017-2018)

According to official figures trade between the two countries were at US$ 28.42 million, was 12 percent more than for the similar period of 2016 (US$ 25.6 million). Trade turnover between Kazakhstan and Pakistan in January-August of 2018 amounted to US$ 21.7 million. Nevertheless, both countries have passionate targets of bilateral trade ranging from US$ 250 million to 1000 million in the days to come (a meeting between Foreign Ministers of Pakistan and Kazakhstan in Bishkek on the sidelines of SCO Council of Foreign Ministers’ meeting to enhance the bilateral trade volume to 1 Billion Dollars).

Diversified & Integrated Operationalization & Channelization

 

Official Statistics

According to official statistics the Pakistani export to Kazakhstan largely comprises of precious stones and jewellery, textile, chemical and pharmaceutical products, agricultural and food goods, vegetables, shoes, leather items, sport and medical equipment, construction materials and etc. Pakistan imports from Kazakhstan construction and materials, food, machinery and equipment, fertilizers, coal, iron and nonferrous metals, seed oil and etc.

Pakistan has a huge consumer market and in order to take advantage of its vastness, Kazakhstan may export to Pakistan energy resources, electricity, mining and agricultural products, in particular wheat and meat. Similarly, Kazakhstan is importing in a large volume from Pakistan products of textile, cotton, leather industry, along with sanitary engineering equipment, medicaments and surgical instruments. Since we are living in an era of commercial diplomacy there is an urgent need to improve trade relationship through systematic awareness among the business circles of both the countries.

Contributory Role of CGSS, Pakistan

In this regard, The Center for Global & Strategic Studies (CGSS), Pakistan being a reputed Public Policy Institute in Pakistan with a mission to help improve policy and decision-making through analysis and research may play a contributory role to conduct interactive sessions in various chambers of commerce, informative seminars/conferences in business/investors communities, publications of research papers/articles, circulations of news items (CGSS has now MOU with Associated Press of Pakistan APP & Pioneer of Media Cooperation among BRI partners) and holding of One-Country Exhibitions on regular basis.

CGSS” Series of Diversified & Interconnected Policies Initiatives & Structural Steps  

Being a prime Think Tank on Euro-Asia in Pakistan and region as well, the CGSS Pakistan may also be useful and effective to form befitting policies to gear-up bilateral trade volumes in the days to come. Furthermore, the CGSS Pakistan is ready to arrange a number of seminars, conferences, round-tables collaborations by including all the main stakeholders and road-shows to be held in the major cities of Pakistan and Kazakhstan with the aim of increasing awareness of local business circles about mutual potential of both the countries in terms of trade and investment opportunities, as well as tourist potential.

CGSS: A Valuable & Workable Remedy

Even, Sialkot exporters may be ready to establish international standard ‘Pakistan Trade Centre’ at Kazakhstan to boost ties. Being prominent regional expert of Kazakhstan I suggest that government of Kazakhstan may consider to allow/facilitate Pakistani exports to re-export their products from Kazakhstan to Central Asian States and Russian states. It may widen and brighten the scope of various joint ventures between the two countries in the days to come.

CGSS: Banking & Financial Integration

We also suggest that there is a huge potential in banking & finance sectors which may be explored by both the countries. In this regard, the Astana International Financial Center (AIFC), stock exchanges of Pakistan and last but not least, the Trade Development Authority of Pakistan (TDAP) should cooperate to enhance diversified activities of business, investment, joint venture and financial integration in the days to come.

CGSS: Innovative Mechanism to Boost Tourism & Air-Links

For further strengthening of cooperation in the fields of tourism, air-links/communications and hospitality both countries must consider positively to have trilateral agreement (Kazakhstan-Uzbekistan-Pakistan) because both the Central Asian Countries (CACs) have already signed a “joint Visa mechanism” for the promotion of tourism and hospitality sectors. Although, Islamabad and Astana (PIA & Astana Air) have already started research work to look into possibility of direct air link between the two countries however, the plan could not materialize because of want of passengers, on this route. To overcome this shortcoming, a trilateral agreement may be signed among (Kazakhstan-Uzbekistan-Pakistan) to start-up the direct flights through interconnected possibilities with Turkey & EU.

Military Cooperation

Time and again the Kazakhstan has shown its keen interest to expand its ties in the fields of military cooperation, production, training, education and its associated sectors. In this regard, the Kazakhstan Ministry of Defence and Ministry of Defence and Aerospace Industry visited Karachi and attended the 10th IDEAS-2018. There are more than 38 representatives of the Armed Forces of Kazakhstan have already been trained since 2005 in military schools of Pakistan. Even during (2019-2020) four Kazakhstan officers got trained at the International Centre for Peace and Stability in Islamabad.

Kazakhstan is keen to take advantage from Pakistan’s vast expertise in combating terrorism. The first joint counter terrorist exercises “Dostarym-2017”, were held in November 2017 at the National Anti-Terrorist Centre of the Pakistan which further enhanced operational, strategic and tactical military cooperation between both the countries. The second counter terrorism exercises “Dostarym-2019” was held in 2019. It is suggested that both countries have to examine in a systematic way and pinpoint various untapped opportunities in the fields of military and defense cooperation and production in the days to come.

Diversified Forums

Bilateral cooperation forum like Pak-Kazakh Inter-Governmental Commission (IGC) may also be used to enhance volumes of trade & commerce between both the countries. Establishment of Islamic Organization for Food Security (IOFS) and other such forums may also be useful for further strengthening of bilateral relations. In the near past, the Trade Development Authority of Pakistan (TDAP) organized a large composite stall at the Trade Caravan in Almaty where 45 exhibitors of garments, sports goods, home textiles and other miscellaneous consumer product actively participated.

The Central Asia Regional Economic Cooperation (CAREC) Program is another vital strategic step of ten regional countries which was created in 1997 to promote economic cooperation in the region. The CAREC Corridor connects Pakistan to the Western markets of Europe and Russia, passing through Afghanistan, Tajikistan, Uzbekistan and Kazakhstan. The proper utilization of all these forums may provide a befitting proposition to all the countries. 

Pak-Kazakh Bilateral Cooperation in Agricultural Economies

Pakistan and Kazakhstan both have agriculture and industry based economies therefore they should enhance cooperation in these areas. Both the countries are looking for foreign direct investments (FDIs) and cooperation between the two sides would help yield the desired results.

Future Prospects

Singing of Meaningful MOU

A meaningful MoU has already been signed between National Export and Investment Agency “KAZNEX INVEST” JSC and Trade Development Authority of Pakistan (TDAP), to further enhance cooperation for arranging exhibition, exchanging business delegations and holding seminars on trade. Afterward, the TDAP included the exhibition “World Food Kazakhstan, Almaty” in its exhibitions calendar for the year 2019, which helped to introduce Pakistani foods in Kazakh market. In this context, the CGSS, Pakistan may play a decisive role by speeding-up diversified but integrated business & investment activities on reciprocal basis in the future. A mix of Pakistani products may also be launched very soon in Kazakhstan where, TAPAL, Treet Blades and Vital Tea have already been launched.

Suggestions

  1. There is an urgent need to overlook/revise/review whole range bilateral relations to achieve the desired goals of trade & commerce activities and investments inflows in the future.
  2. Special focus should be given to “preferential areas” such as trade, economy, energy, science and technology, education and more importantly land and air connectivity between Pakistan and Kazakhstan.
  3. Formation of a “special forum” for further strengthening of cooperation in diverse fields including regional connectivity, energy, security, education, culture, and people-to-people exchanges.
  4. Rigorous persuasion of “public-private partnership (PPPs) for investments and business activities in both the countries.
  5. B2B linkages between the private sectors of both countries needs to be pursued in good spirits which may untapped many area of bilateral cooperation.
  6. Formation of a group of regional experts (Pak-Kazakh) in the fields of media, research, publication, culture and investment (CGSS, Pakistan may play a paramount role in this regard).  
  7. Diagnostic report about all possible hurdles and impediments in low trade volumes and investments should be prepared as soon as possible.  
  8. Joint ventures in the fields of energy, oil & gas, petro-chemical industries may be a “strategic step” in the right direction. These JVs may be jointly financed through banking channels of both the countries. In this connection, formation of “joint investment company” and “investment bank” may a workable idea which must be materialized in the days to come.
  9. There is a huge scope for further strengthening of bilateral relations in terms of “military cooperation”, “joint defense production”, joint training drills, education and aerospace industries etc.  In this regard, KADEX and IDEAS platforms may be useful. 
  10. There is an urgent need to expedite operations of Pakistan-Kazakhstan Intergovernmental Commission (IGC) on Trade, Economic, Scientific, Technological and Cultural Cooperation to boost economic cooperation that included trade and investment, transport and communications, agriculture, industry, energy, healthcare, environmental protection, information & broadcasting, civil aviation, tourism and training of diplomats.
  11. Formation & activation of “Joint Business Councils” in various sectors is the need of the hour.
  12. Pakistan-Kazakhstan “Diversification Forum” (Public-Private Partnership) to assist both the countries and private sector to achieve the optimal levels of diversification of resources and production channels in both the countries.
  13. Inclusion of Pakistan in “Eurasian Economic Union” may be a value-addition for further strengthening of bilateral relations.
  14. Concept of “Cluster Trading” should be explored and implemented for achieving the desired goals of volumes of trade between the two countries. Expected peace deal in Afghanistan may widen the horizon of bilateral/trilateral trade activities.  
  15. The Quadrilateral Agreement on Traffic in Transit may be a trade agreement between China, Pakistan, Afghanistan and Kazakhstan may also be useful in this regard. It connects Southern China and Pakistan to CARs.
  16. For greater regional connectivity the Central Asian Countries may accelerate the growth of the “Gwadar Seaport”.
  17. Pakistani products i.e. fruits and vegetables, pharmaceuticals, surgical instruments, leather goods have great potential in Kazakhstan and Pakistani exporters should step up efforts to enhance exports of these products to Kazakh market. Formation of Pakistan-Kazakhstan Trade Centres on reciprocal basis would a valuation addition.  
  18. Railway link/logistic Kazakhstan-Turkmenistan to Iran which could be extended to Pakistan to promote bilateral trade and people to people contacts.