Multi-country involvement in CPEC to strengthen regional integration: World Bank

March 20, 2019: A new World Bank report has said that the multi-country involvement including India in China Pakistan Economic Corridor (CPEC) can help achieve greater regional integration.

Suggesting various steps to be taken towards greater integration with the region to liberalize trade and improve logistics, the report titled "Pakistan@100: Shaping the Future" said CPEC can be used to improve relations with other countries that could benefit from it, including Iran, Afghanistan and those in Central Asia.

Other efforts to increase regional integration as relations with neighbors strengthen might include offering India an overland route to Afghanistan in return for gaining access to Central Asia for itself; offer both Karachi and Gwadar ports for use to all neighbors; and work with Iran to develop synergies and complementarities between the Gwadar and Chabahar ports," the report added.

Pakistan should push for the timely completion of connectivity projects already committed to by all countries in the region.

The process of unlocking Pakistan's regional promise must start with a consensus across Pakistan's leadership, and between civilian and military leaders, to use constructive regional relations to support economic competitiveness and growth.

To improve relations with India, the two countries could revitalize the Pakistan-India Joint Chamber of Commerce, normalize visa processing, including for business people, and enter into a dialogue on trade liberalization measures.

In the medium term, the report added that Pakistan could deepen some of the reforms undertaken in the short term, including opening up other border points with India, such as Khokhrapar-Munabao in Sindh and Sialkot in Punjab.

Border infrastructure such as warehouses and improved cold-storage facilities would be necessary to facilitate increased trade between the two countries.

Railway links to carry both passengers and freight from borders and ports to Pakistan's major cities are needed to reduce transportation costs.

On the western border with Afghanistan, similar investments in improved border infrastructure, customs procedures, and road and rail connectivity would expand trade capacity and foster domestic manufacturing growth in Pakistan.

The report also suggested to establish a simple, transparent tariff structure with reduced tariffs, and with clear and transparent rules governing the use of discretionary provisions, including a uniform, less discretionary duty exemption scheme for exporters.

Identifying and implementing key regulatory reforms in the services sector could improve Pakistan's international competitiveness in the tradeable services and manufacturing sectors that are increasingly reliant on professional services inputs, such as logistical and financial services.

Improving trade logistics through procedural facilitation and infrastructural improvement will also be critical. An automated internet-based processing system for border management has already been rolled out.

This roll-out should be completed and extended to all relevant regulatory agencies.

Assessing and subsequently upgrading the biggest infrastructural bottlenecks at borders, such as inadequate weighbridges and scanners, sheds and warehouses, customs facilitation centers, and quarantine and phytosanitary facilities, should be undertaken, the report added. 

Adopting a more modern risk-based compliance management strategy for border controls will help focus attention on the most high-risk consignments, while expediting those that do not pose serious issues.

(APP)