Pak-Uzbek: Accelerators of regional connectivity

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Dr Mehmood-ul-Hassan Khan

THE world is slowly but gradually moving from pandemic to prosperity through integration of socio-economic ties and greater regional connectivity. Uzbekistan and Pakistan have been jointly working for promoting trade & commerce ties, business activities, foreign direct investment and joint ventures. In this context, Uzbekistan-Pakistan bilateral relations have been further strengthened during recent times because of the better political understanding, improvement in bilateral trade, phenomenal rise to tourism and the last but not the least joint efforts to bring peace and harmony in the region especially in Afghanistan.

The Advisor to the Prime Minister on Commerce and Investment, Abdul Razak Dawood visited Uzbekistan and held various meaningful bilateral trade negotiations with Uzbekistan’s high officials to enhance the trade volume between both sides. He also met with H.E. President of Uzbekistan Shavkat Mirziyoyev and discussed diverse matters of further strengthening of bilateral trade, regional connectivity, trans-regional railways project, PTA/FTA, FDI and joint ventures. It was agreed to proceed further for achieving the win-win and befitting propositions for both the countries. The two States resolved to enter into Preferential Trade Agreement for increasing the bilateral trade and promote trade liberalization. Revival of the Joint Business Council was also discussed and consequently assured that bilateral engagements like Inter Governmental Commission will be held more frequently.

In this regard, the first meeting of Joint Working Group on Trade and Economic Affairs and the meeting of Tripartite Working Group on the Implementation of the Trans-Afghan Railway Project were held from February 1st to February 4th, 2021. The two sides discussed Streamlining Bilateral Phytosanitary Standards enhancing banking cooperation, working on rail and road connectivity matters and establishment of off dock terminal. Both sides also discussed the possibility of establishment of Joint Cargo Company by private sector, which can mitigate connectivity issues. It was highlighted in the meeting that private sector is quintessential for bilateral trade, therefore, the two sides resolved to have cooperation in shipping, textile, engineering and IT sectors.

During his annual speech to the nation and address to Shanghai Cooperation Organization (SCO) Heads of State meeting during (November-December 2020), the Uzbek President Shavkat Mirziyoyev showcased foreign policy priorities (2021) for greater relationship/connectivity with South East Asia and proposed to eliminate trade barriers, simplify customs procedures, and boost investment and thus accelerate socio-economic ties. On its part, Pakistan provides the natural link between the SCO states/CIS to connect the Eurasian heartland with the Arabian Sea and South Asia. It offers the safe and compatible overland routes/seaports and essential connectivity for befitting propositions in terms of trade and energy supplies.

To materialize the dreams of greater regional connectivity, peace and harmony the government of Pakistan signed a joint request letter seeking a $4.8 billion loan from international financial institutions for a mega railway project to connect Pakistan with Uzbekistan via Afghanistan and later to other Central Asian States. The said railway joint project has already been approved by the Presidents of Uzbekistan and Afghanistan. It hopes that the project will help improve regional trade and connectivity through Afghanistan to the Central Asia Republics.

The signing ceremony was attended by Uzbekistan’s Minister for Transport Makhkamov Ilkham and senior Pakistan government officials. During the meeting, Imran Khan affirmed Pakistan’s eagerness “to establish closer ties with Central Asia in diverse sectors of trade, investments, energy, and people-to-people contacts. Prime Minister Khan upheld Pakistan’s strong commitment to deepen bilateral cooperation. On his part, Uzbek Minister highlighted Uzbekistan’s desire to improve bilateral trade and commercial ties and connectivity with Pakistan. He also discussed rail and road cooperation and explored region’s direct access to the seaports. Prime Minister Khan emphasized the significance of joint efforts to promote connectivity for regional development and offered Pakistan’s seaports for greater regional connectivity.

The $4.8 billion trans-Afghan railway line “Mazar-e-Sharif-Kabul-Peshawar” project consists of 573-km long railway track, connecting Peshawar to Kabul and Mazar-e-Sharif all the way to Uzbekistan. Pakistan would operate the routes from Peshawar to Torkham beyond which Afghanistan and Uzbekistan will operate it. Pakistan Minister for Railways Azam Khan Swati showcased salient features of the said trilateral project connecting Pakistan Railways with Afghanistan and Uzbekistan and will include both passenger and cargo high-speed trains. He termed the project a huge opportunity to boost trade flows and strengthening regional economy. It hopes that the said project will provide a new impetus to Pakistan Railways after the country’s most expensive $6.8 billion Mainline-1 (ML-1) project to upgrade 2,655km tracks under China-Pakistan Economic Corridor (CPEC). The trilateral rail project opens up “a new window of opportunity for all the CIS.

On its part, Uzbekistan’s national rail company, Uzbekistan Temir Yullari (UTY), constructed the 75-kilometer rail link between Hairatan at the border of Uzbekistan and the city of Mazar-e-Sharif in northern Afghanistan which was a vivid reflection of cooperation between two CAREC member countries. It started from the Hairatan freight terminal on the Afghan bank of the Amu Darya River the 1,520 mm gauge single track line was built through relatively easy terrain to the outskirts of Mazar-e-Sharif. The $170 million project was completed during 2011-2012. The rail project has had a significant economic impact, as almost half of Afghanistan’s imports pass through Hairatan.

The various visits of high official of both the countries have strengthened meaningful deliberations in all areas of bilateral cooperation including political, security and defence cooperation, peace process in Afghanistan as well as trade and investment promotion during which areas of mutual interest for future collaboration were also identified, including agriculture, tourism and cultural cooperation. Pakistan and Uzbekistan have common views on regional security, especially peace and stability in Afghanistan.

Moreover, establishment of a joint working group on trade and commerce in diverse sectors of economy, formation of a Joint Chamber of Commerce, investment company and start of even cargo fights may act as suitable accelerators to push-forward the regional economies to achieve desired goals of socio-economic integration, energy & food cooperation, tourism, education and culture cooperation in the days to come. Furthermore, start of joint ventures in various areas including agriculture, textile, pharmaceuticals, tourism and construction would play an important role. Being a prominent regional expert of Uzbekistan and CIS, I endorse that the railways project will further enhance the connectivity in the region. The project will add to Pakistan’s potential as the regional transit hub, enhance connectivity with Central Asia and beyond and aid in regional development and prosperity.
—The writer is Director, Geopolitics/Economics Member Board of Experts, CGSS.