Dr. Mehmood Ul Hassan
30 years of diplomatic ties of Pakistan and Uzbekistan have now been jointly celebrated. It has been journey of close brotherly fraternal relations anchored in shared history, culture and religion.
I categorically deny all speculations of any change in the foreign policy of Pakistan towards the Central Asia Region and especially towards the Republic of Uzbekistan after current political change in Pakistan.
Our foreign policy is not “person centric” rather it has been state’s constant resolve and commitment achieving sustainable bilateral and trilateral relations with all the states of Central Asia Region especially with Uzbekistan. Thus our foreign policy does not believe in sudden “U turns” and zigzag orientations. Although rapidly changing socio-economic, geopolitical and geostrategic scenarios demand rational change accordingly.
Pakistan has been maintained permanent resolve to strengthen ties with Uzbekistan through enhanced interaction through immense socio-economic integration, greater regional connectivity and further strengthening of bilateral relations in diverse sectors of economy, FDIs, joint ventures, special economic free zones, trade & commerce, integrated transport systems, food & energy security, renewables, pharmaceutical, agriculture cooperation, science & technology, banking & finance cooperation and last but not least, culture cooperation with Uzbekistan.
I uphold that Uzbekistan has been center of our immense importance to Pakistan as it could serve as a gateway to Central Asia and beyond due to its ideal geographical location.
Uzbekistan is the leading trading partner of Pakistan in the Central Asia and extending cooperation in diverse sectors would further boost economic activity for mutual benefit of both the countries. Time and again the government of Pakistan invited Uzbekistan to join economic activity generated through CPEC.
Critical analysis of both countries reveals that Pakistan has 7 times bigger population than Uzbekistan (Pak: 220 Million & 34 Million). And GDP maintains 5 times (Pak; US$ 305 billion & US58 billion). Thus crucial factor and driver of greater socio-economic integration is very much there between two sides.
Moreover, Uzbekistan exports to Pakistan was US$126.64 Million during 2021 whereas, Pakistan’s exports to Uzbekistan was US$ 48.79 million. “In the past, bilateral trade stood at only $20 million, which reached $185 million in 2021.
During the last 17 years the exports of Pakistan to Uzbekistan have increased at an annualized rate of 15.2 percent, from $3.3M in 2003 to $36.5M in 2020 which is still on the rise. Hopefully, PTA will increase the trade further,” because now agreements are being signed between the provinces and cities of Pakistan and Uzbekistan for mutual cooperation.
According to a recently conducted research study Pakistan’s export potential in its trade with Uzbekistan should be at US$ 373.1 Million. The products which showed the highest potential for exports to Uzbekistan are pharmaceutical products, wheat, potatoes, sugar, bananas and surgical instruments which should be further diversified. Portland cement, polyethylene, parts of gas turbines, vegetable fats, food preparations and products of iron may also be included in exports mix to Uzbekistan.
Unfortunately, the lack of formal banking channels is a major impediment to the development of trade with Uzbekistan. It is important that the State Bank of Pakistan (SBP), the Ministry of Finance & Commerce, private businesspersons and other stakeholders develop a viable framework to help overcome the challenges posed by the financial regulatory regime in Uzbekistan.
For promoting bilateral trade, both governments should send trade delegations on reciprocal basis in order to help develop better insights into the respective markets. The Trade Development Authority of Pakistan (TDAP) should start organizing international exhibitions in Uzbekistan for the products where Pakistan has an advantage. It is important to promote direct transport linkages between the two countries.
In this connection, the government, parliament, policy makers, businessmen and even common people would extend all out support to pave way for enhancing Uzbek trade and investment in Pakistan.
Pakistan in its foreign policy strategy attaches great importance to Uzbekistan. The Uzbek side also considers Pakistan a gateway to South Asia, Indo-Pacific and Middle East regions through its seaports at Gwadar and Karachi. Thus BRI and CPEC would be bench mark for further strengthening of bilateral trade and connectivity between two countries.
During recent times, due to immense constant and constructive political dialogue at the highest level and Ten Commandments of Uzbek President Shavkat Mirziyoyev the trustworthy bilateral relations between Pakistan and Uzbekistan has now been converted into a “Strategic Partnership” with having PTA and inching towards FTA.
The sustainable bilateral relations between two countries have been acting as “strategic cushion” and “deterrence” against terrorism and extremism, drug trafficking and weapons, organized crime and proliferation of weapons of mass destruction, promoting mutually beneficial economic ties, partnership in social, cultural and humanitarian spheres.
Most recently, H.E. Sardor Umurzakov, Deputy Prime Minister of Uzbekistan called on General Nadeem Raza, Chairman Joint Chiefs of Staff Committee at Joint Staff Headquarters, Rawalpindi.
During the said meeting, matters of bilateral strategic interest with particular emphasis on evolving regional security situation particularly in Afghanistan and further strengthening of security & defence cooperation between the two brotherly countries were brought into discussion during the meeting. Both dignitaries also agreed to enhance the level and scope of military engagements between both countries and reaffirmed to continue to forge deeper ties.
Chairman JCSC said that Pakistan is keen to expand its existing bilateral military-to-military cooperation with Uzbekistan as part of Pakistan’s ongoing upward trajectory in Defence ties with the regional countries.
H.E. Mr. Sardor Umurzakov commended the Pakistan Armed Forces for their role in safeguarding the vital national interests of Pakistan and defending its sovereignty/ territorial integrity.
Furthermore, joint military exercises, training and cooperation in military education cooperation has been on the rise between two countries. The Turkish, Uzbek, and Pakistani armies held joint military drills Jizzakh, in eastern Uzbekistan. The exercise, named Partnership Shield 2019, was the first held between the three countries.
Let us talk about security irritants to both the countries. Certainty, Afghanistan has been one of the biggest security threats to both for the last 40 years. Unfortunately, Afghanistan has been an ideal hideout for regional as well as global terrorist sanctuaries. That is why Al-Qaeda, ISIS, Taliban TTP and many other terrorist organizations have been indulged in a so-called holy war against the US, NATO, Afghan government and communities alike. Unfortunately, Pakistan and Uzbekistan have been facing spillover repercussions for this mushroom growth of terrorism and regional proxies on the soil of Afghanistan.
Pakistan has suffered several attacks from Afghan-based terrorist organizations, primarily the Islamic State in Khorasan Province (ISKP). ISKP has claimed many attacks on the Pakistani consulate and interests in Afghanistan and a deadly suicide bombing at the Shah Noorani Shrine in Balochistan, among others. The Islamic Movement of Uzbekistan (IMU) also operates out of Afghanistan as well. Thus effectiveness of cooperation in the field of security between two countries is the need of hour.
Mechanisms for regular meetings at various levels should be set up and a solid legal framework regulating the interaction of both the states in ensuring peace and stability in the region is developed for these proposes. In this connection, the Uzbekistan proposed SCO members’ security councils was launched in 2004 which should be replicated between two countries.
The Regional Anti-terrorist Structure (RATS), the Executive Committee of which is located in Tashkent should play a special role in the further strengthening of peace and tranquility and promote coordination and cooperation in the fight against terrorism, separatism and extremism.
Moreover, special attention should be paid to full support of direct business contacts, strengthen cooperation in such sectors as transport, infrastructure, banking and financial sector.
To conclude, Pakistan and Uzbekistan have already signed a preferential trade agreement to lower duties on nearly three-dozen products in the range of 20% to 100% aimed at giving a boost to the trade value that remains very thin despite vast potential which should be implemented as soon as possible.
In the preferential trade agreement, both the countries have agreed to give tariff concessions to each other on 17 items, by reducing duties from 20-100%. The concessions have been approved by the Tariff Policy Board, in the meeting held on Monday.
Uzbekistan’s location in Central Asia could be used to connect trade routes in Asia and Europe by building Trade Houses in Special Free Economic Zones in Uzbekistan.
In April 2021 Uzbekistan joined the EU’s GSP+ (Generalised Scheme of Preferences) scheme, which will remove trade tariffs on two thirds of the product lines covered by GSP, and is expected to aid economic growth. Moreover, in March 2022 Uzbekistan signed a Preferential Trade Agreement (PTA) with Pakistan, which will lower the tariffs on the 34 goods covered. More importantly, this will give Uzbekistan access to Pakistan’s sea ports and strengthen trade routes in the south. Thus bilateral cooperation in textiles, garments, fashion industry, and leathers should be streamlined and systematized between two countries.
Moreover, there is a high possibility of signing a free trade agreement between Pakistan and Uzbekistan in the days to come which would be game and fate changer between two sides.
A transit trade deal has also been inked by the two countries, which facilitated the movement of goods via land route between the two countries including through trucks. The expected FTA between Pakistan and Uzbekistan could play a better role in promoting bilateral trade if there could be a similar trilateral agreement between Afghanistan, Pakistan and Uzbekistan.
Hopefully, “after such an agreement, economic integration between Central Asia and South Asia will expand and regional trade will get a considerable boost.”
A joint and giant trilateral railway project has been pursuing among Pakistan, Uzbekistan and Afghanistan. In this connection, the engineers and technical staff of both countries are carrying out work on the project and all the three parties, including Afghanistan, agreed to implement it. Interestingly, Afghanistan’s province of Mazar-e-Sharif is already connected to Uzbekistan through a railway line. The railway link between Pakistan, Afghanistan and Uzbekistan will not only link our trade with the countries in the two regions, but will also give them access to the Euro-Asian and European markets.”
(The author is Director:
The Center for South Asia & International Studies (CSAIS) Islamabad Regional Expert: Uzbekistan & CIS)