Former US Secretary of State Mike Pompeo has stated that it is clear from the economic trajectory that India and Pakistan have taken different steps. Pompeo made this statement at the Rising Bharat Summit. He emphasized that the world would be fundamentally more prosperous and secure if former President Donald Trump is re-elected. Pompeo's remarks highlight the contrasting economic paths chosen by the two neighboring countries. India has pursued economic reforms and liberalization, while Pakistan has faced economic challenges and relied on external assistance [d4d02878].
Indian Prime Minister Narendra Modi has not responded directly to Pompeo's comments. However, India has been focused on its own economic growth and has implemented various reforms to attract foreign investment and promote domestic industries. The Indian government's initiatives such as 'Make in India' and 'Digital India' have aimed to boost manufacturing and digitalization in the country. India has also been working towards improving ease of doing business and has made progress in areas such as taxation, infrastructure development, and labor reforms. These efforts have contributed to India's economic growth and its position as one of the fastest-growing major economies in the world [d4d02878].
On the other hand, Pakistan has faced economic challenges and has relied on external assistance to address its financial difficulties. The country has received financial aid from international organizations such as the International Monetary Fund (IMF) and has implemented economic reforms as part of the loan agreements. However, Pakistan's economy continues to face structural issues, including a high fiscal deficit, low tax collection, and a large informal sector. The country has also struggled with issues such as corruption, political instability, and security concerns, which have affected its economic growth and investor confidence [d4d02878].
The strained trade relations between Pakistan and India have been a result of geopolitical tensions and political and strategic differences. Efforts to expand trade relations have been hindered by these tensions. Trade between the two countries has been overshadowed by political and strategic issues, leading to negligible numbers in the past ten years. Pakistan's imports from India have seen a downward trajectory since the BJP government came into power in 2014. The BJP government imposed stringent measures to disrupt trade ties with Pakistan, including withdrawing Pakistan's 'Most Favoured Nation' status and imposing high customs duties. Trade was further disrupted due to unfair hurdles and threats from the Indian side. Pakistan's Foreign Minister has indicated a willingness to examine trade ties with India, but India remains cautious and suspicious. India believes it is in a stronger position economically and has focused on expanding trade with other countries. The current status of political and diplomatic ties between India and Pakistan remains grim for bilateral trade relations [2721d75d].
Pakistan, however, can leverage its trade partners, the US and China, and push for stronger trade connections with other countries through the Gwadar Port and the China-Pakistan Economic Corridor. Pakistan's Foreign Minister has expressed the need to explore trade ties with India, but it remains to be seen if the two countries can overcome their political and strategic differences to foster a more robust trade relationship. In the meantime, Pakistan can focus on expanding trade with other countries and utilizing its strategic location to enhance its economic growth and development [2721d75d].
The contrasting economic paths of India and Pakistan have had implications for their respective development and regional dynamics. India's economic growth has enabled it to emerge as a major global player, attracting investments and expanding its influence in various sectors. The country has also been able to invest in its defense capabilities and enhance its strategic position. On the other hand, Pakistan's economic challenges have limited its development and hindered its ability to address social and security issues effectively. The economic disparity between the two countries has also contributed to tensions and conflicts, including the ongoing Kashmir dispute. Efforts to improve economic cooperation and address the root causes of conflict remain crucial for promoting stability and prosperity in the region [d4d02878].