BY : Majyd Aziz,
Former President,
Karachi Chamber of Commerce and Industry.
The ecosystem in the community of nationshighlights that there are no permanent enemies or friends. The relations between states are determined by their national interests. The Pakistan-Russian relations vary from cold and warm but there has never been a moment when there was closeness in real terms. Pakistan has been in the American camp since the time Liaquat Ali Khan, the first Prime Minister, canceled a trip to Moscow and headed for Washington. Even during the so-called Cold War, the geopolitical environment further made bilateral relations really cold. Pakistan’s active role in ensuring the retreat of the Russians from Afghanistan further alienated Russia. Even then, despite the lack of closeness, Russia did agree and helped build the Pakistan Steel Mills and also assisted in the setting up of Oil and Gas Development Corporation. Both these organizations played and are playing an essential role in the economic self-sufficiency of Pakistan.
Fast forward to the 21st Century, both companies forged defense cooperation and that also led to Russia supporting Pakistan’s membership in Shanghai Cooperation Organization. In many ways, the two countries, alongwith China, moved many steps forward. Pakistan is earnestly lobbying for membership in BRICS and has not been successful, mainly due to the unwarranted opposition by India. Now, the regional and global dynamics are shifting. New alliances and new thinking have become paramount. General Pervez Musharraf, eyeing more defense cooperation, visited Russia and enabled the ice to melt somewhat. Imran Khan went a mile further and invited Vladimir Putin to visit Pakistan. Unfortunately, this long-awaited trip has yet to see fruition. The presence of President Putin would havedefinitely been a gamechanger as it would have encouraged Russian oligarchs as well as state enterprises to invest and trade with Pakistan.
The Russian-Ukraine War should have been an economic bonanza for Pakistan, especially Russia being the source of cheaper priced oil despite transportation costs and to some extent the quality of oil compared to Saudi Arabian oil. Despite this, Pakistan would have had another oil source in times of emergencies such as wars or blockades in the Middle East. Pakistan imported wheat from Russia, as it did last year when Pakistan faced an acute shortage. China initiated and is taking maximum advantage of CPEC. Russia too could use this land route to access the massive regional economic markets in South Asia and the Middle East.
The bilateral trade regime can be further enhanced with Pakistan accessing the availability of the Russian energy sector, taking advantage of the hi-tech metallurgy experience to enhance the engineering sector, grains such as canola, pulses, wheat, and also source military hardware. Pakistan is well-placed to export textiles, leather goods, sports equipment, surgical instruments, and even set up joint ventures in Information Technology. More importantly, efforts should be made to increase bilateral trade figures that are just a shade above $1 billion. However, trade is tilted in favor of Russia which exports about $900 million while importing less than $70 million from Pakistan. Of course, this was primarily due to imports of wheat exceeding $650 million. A concerted action must be taken by both countries to sign the Free Trade Agreement and even, to some extent, a Currency Swap Agreement.
Pakistan is now in a position to move closer into the China Russia axis, especially when India, the most favorite friend of Russia, is now looking more towards the West. This is the window of opportunity since Pakistan is also very close to the Central Asian States and losing this opportunity would be akin to Pakistan not taking advantage of this promising global shift. A strong bond of Druzbha (friendship) would in the long-term be extremely beneficial for the economic prosperity of the land of 250 million citizens. A Former Russian Ambassador to Pakistan very superbly said in one of his meetings in Karachi, ‘We are now seeing a renaissance of ties between Russia and Pakistan’.
BY : Majyd Aziz,
Former President,
Karachi Chamber of Commerce and Industry.
