Caravans wait to roll again across the LoC.

[AgNoStiC MuSliM]

Line of Commerce​

Caravans wait to roll again… across the LoC.​

Haroon Mirani

Sixty years have passed since the last caravan of goods moved to and fro on Kashmir’s main trade highway — the Jhelum valley road popularly known as Srinagar-Muzaffarabad road — linking it with the outside world.

Ghulam Rasool Khan, a Kashmiri businessman whose grandfather had shops in Rawalpindi, nostalgically recalls the old days: “There was no concept of trade without this road. I would board a motorcar in the morning, reach Baramulla, have tea, then enter Chinari (Pakistan-administered Kashmir), have the world’s best lunch — a tasty chicken dish, then cross over the Kohala Bridge that divided Kashmir kingdom from British India and ultimately move from Muree hills to Rawalpindi… It was the best journey of my life along a road whose beauty still remains unmatched.” Khan is among the hundreds of Kashmiri businessmen who had flourishing businesses in today’s Pakistan but had to forego that profitable trade in 1947, when the Partition of the Indian subcontinent was followed by the bloody division of the princely State of Kashmir into Indian and Pakistani Kashmir.

Subsequently India constructed an alternative highway, now known as the Srinagar-Jammu highway, which is the mainstay of trade these days.

Traders in Kashmir have their fingers crossed as the slow-moving peace process drags on towards the mega confidence-building measures of cross-LoC trade. They have been waiting for assurances of trade resumption between Jammu and Kashmir and Pakistan-administered Kashmir (PaK).
Who can trade?

Mubeen Shah, president of Kashmir Chamber of Commerce and Industry (KCCI), thinks that the opening up of trade between the two sides will bring in a ‘revolution’, but “the government of Pakistan is yet to clear the names of traders wishing to visit Jammu and Kashmir for discussing trade modalities,” he says.

The Passport Officer at Srinagar who is authorised to receive and approve the names of people willing to trade across LoC has not received any names from the other side. And the little contact there is between KCCI and PaK Chamber of Commerce is limited to a few emails. “I also talk to them (traders across LoC) on phone when I visit New Delhi, as the telephone call is not allowed from Jammu and Kashmir to PaK,” says Shah.

With the opening of this route, traders hope to find alternative markets for Kashmiri products, as many local commodities can be traded to PaK and beyond.

Terming horticultural produce and handicrafts as two major trade items, Shah says, “If all goes well then in a couple of years we might see trade volumes crossing tens of crores of rupees.”

Kashmir currently exports horticultural produce estimated to be worth Rs 2,000 crore. Innayatullah, who owns a large apple orchard along the Srinagar-Muzaffarabad road says, “This road will lead us to prosperity. We will get more from markets in Pakistan as compared to what we are getting in India.”
Faster and more profitable

Farmers say transportation time for perishable commodities will be reduced drastically. “Currently we incur huge losses as our fruits get wasted along the long and often blocked Jammu-Srinagar highway. The losses are sometimes unbearable for a farmer and crops such as cherry and apple are more prone to decay,” he adds.

On average a truck takes 36 hours to reach New Delhi on a clear road and much longer if it is headed to other Indian markets. “But if we send our fruit through the Srinagar-Muzaffarabad road, it would reach Islamabad in six to eight hours. Besides, it is an all-weather dependable road that will never disappoint you,” he adds. As for imports from PaK, traders are keenly looking forward to improved availability of wood for the handicrafts industry as well as for construction.

“PaK has a developed wood-work industry and they have abundant raw material, particularly walnut wood, due to better management of forests there,” says Khan, whose ancestral firm Ganemede used to source wooden furniture from PaK.

“We hope to import in both categories as currently Kashmir is facing an acute shortage of wood and it is sourcing this material from as far as Malaysia,” he adds.

Shah estimates Kashmir’s meat and poultry products market at around $4 billion and says traders from PaK would love to have a share of this.

“Possibilities are immense; there are lots of items which can be traded, but we are not being given the opportunity to meet and discuss the matter threadbare,” says Shah. “Our final list is awaited and both countries also have to decide which items would be allowed for trading.”

The two sides have already exchanged the list of items to be traded across the Line of Control. Recently, Minister of State for Commerce Jairam Ramesh told newspersons in Srinagar that the Indian side had forwarded a list of 10 items and the Pakistani side has asked for 16 items.

Among the products waiting to go from Jammu and Kashmir to PaK are carpets, rugs, wall hangings, papier mache, embroidery, shawls including Pashmina and tapestry, cricket bats, furniture and other wooden items, silk and silk products, Kashmiri fruits, dry fruits (almond, walnut), Kashmiri spices, Kashmiri saffron, Kashmiri Wazwan, aromatic, medicinal and fruit-bearing plants, coriander, moong dal, rice, Basmati, black mushroom and green tea.

From the other side the item list includes spices, apples, walnut, rice, precious stones, papier mache powder, Gabbas and Nawdas (carpet cloth material), furniture, marble, onion, garlic, medicinal herbs, embroidered items, pine nuts (chilgoza) and carpets.

Hundreds of businessmen are ready to reopen their shops in PaK and other Pakistani cities. In fact the much-awaited reopening of JK Banks in PaK will help further the cause of cross-LoC trade.

The KCCI, which was founded in 1934, hopes to eventually merge with PaK’s Chamber of Commerce.

But looking beyond PaK, the traders are eyeing the broader Central Asian market.

According to independent estimates, the cross-LoC trade is expected to be in excess of $1 billion. This amount is reportedly making the finance ministry a bit jittery and it wants to take a closer look at the entire process, point out traders.

Pakistan too has been overcautious in agreeing to resumption of trading owing to its inherent fear of the entry of Indian products in the garb of Kashmir trade.

Duty-free trade with US

Pakistan hopes to boost its exports to the US on the back of a proposed US bill to allow duty and tax-free imports from special Reconstruction Opportunity Zones (ROZ) in Pakistan.

But even more than Pakistan, Kashmiri traders are excited because the earthquake-affected Pakistan-administered Kashmir is among the ROZs identified.

The US is a leading consumer of handicraft goods, particularly carpets. Kashmiri traders hope to relocate or outsource their carpet weaving work to PaK, to take advantage of the proposed US bill. Kashmir currently exports carpets and other handicrafts worth Rs 700 crore.


President of the Kashmir Chamber of Commerce and Industries Dr Mubeen Shah says there are many such zones in several continents from which US imports duty-free goods. “These zones have simply uplifted the economies of their respective countries and the same will be with entire Kashmir,” says Shah.

Even Indian traders are supposedly hoping to benefit. “They will simply pour in billions of dollars of investment in PaK, if everything goes well,” says a trade expert in Srinagar. “Because PaK is not far from India — just a couple of kilometres from the already established heavy industry grid of Jammu — they will have no problem crossing over the line, of course if the governments agree.”

The Hindu Business Line : Line of Commerce

Excellent developments. The presence of the ROZ's in FATA should help tremendously in cutting down the level of support for the Taliban, and their presence in Azad Kashmir should boost development tremendously.

Then we also have the SEZ's coming up for exports to China. I imagine some of these will be in Balochistan, Gwadar perhaps? Great moves for developing the more backward areas.

I found the comment about "better management of forests" in Pakistan interesting. I thought we couldn't cut them down fast enough, hopefully they wont become a casualty of trade. I do hope that more effective measures to prevent Indian products illegally entering Pakistan are put in place though. Any one hear of the guy trying to import Ashok Leyland buses by filing away the "made in India" imprints etc. from Dubai?

Hmm "Ashok"..ding ding ding!