The association of Pakistan with the United Arab Emirates (UAE) goes back to the foundation of the Emirates (a group of seven nations is the south-west Asia on the Persian Gulf). Pakistan was the first country to recognize the UAE since its establishment on December 2, 1971. The bilateral relations between the two countries are acquiring new dimensions at all political, economic and social levels.
The UAE has become Pakistan’s largest trading partner among the Gulf Cooperation Council (GCC) member nations, with bilateral trade reaching US$ 9 billion (Dh33 billion) out of US$19 billion for the GCC, while the military-to-military relations between the UAE and Pakistan were always excellent.
Bilateral trade between the UAE and Pakistan has reached $8.3 billion, recording a significant 9.4 percent increase during the last fiscal year 2016-17. Trade between the two countries stood at US$7.7 billion in 2015-16. It has witnessed a positive development during the last year. The success of the last edition of the Expo in 2015 was manifested by the participation of a large number of local and foreign buyers who transacted business deal worth $1.2 billion. The Expo provides a great opportunity to international buyers and visitors with a comprehensive overview of the entire Pakistani market and industry.
Pakistan is working with the UAE authorities to increase exports of fresh fruit and vegetable from Pakistan. Pakistan is finalizing plans to operate a speedy vessel from Karachi to Dubai to bring perishable items within 48 hours, reducing the current sailing time of up to eight days. Pakistan and UAE should develop a 10-year roadmap to benefit from potential areas of mutual cooperation. Both countries have great scope to promote trade in many areas.
Pakistan’s private sector should actively participate in the Annual Investment Meetings and Expo 2020 in UAE to explore possibilities for enhancing their business prospects. The UAE would host this first international level Expo 2020 in which 100 countries would participate.
Hundreds of Pakistani companies were doing successful business in free economic zones of the UAE.
Exchange of business delegations is important to explore new avenues of cooperation. UAE would work with chamber of commerce industries in Pakistan to promote connectivity between the private sectors of both countries. Pakistan and UAE enjoyed cordial relations but their bilateral trade of over $8 billion was not reflective of the actual potential of both countries. Both countries should focus on promoting strong connectivity between their private sectors and facilitate frequent exchange of trade delegations that would help in further enhancing current volume of bilateral trade.
Pakistan and the UAE should focus on developing strong linkages between their youth and women entrepreneurs by creating platforms like youth and women business councils that would help in promoting sustainable trade and economic relations between both countries.
Pakistan offers tremendous investment opportunities to the UAE’s investors in various sectors of its economy including infrastructure development, power generation, water management and agro industries. Areas including aluminum products, horticulture, farming, dairy farming, livestock, financial sector, pre-fabricated houses and affordable low income houses also offered good prospects for JVs.
The two countries should strengthen their SMEs to achieve more beneficial results. There should be regular interaction between the chamber and the UAE embassy to explore areas for improving bilateral trade and economic relations.
A new trade link between China and Pakistan will greatly benefit the UAE and other GCC countries over the next five to 10 years. The China-Pakistan Economic Corridor, which was introduced in April, would significantly increase trade in the region. In five years, the corridor will become almost fully operational, and Pakistan is the foremost transit country so this will enhance the trade with Pakistan and the GCC. It holds the best promise for GCC oil and gas exports. This corridor will save large ships time and money through Gwadar port developed in a city on the southwestern Arabian Sea coast of Pakistan. It is difficult for oil tankers but this is the largest deep seaport in the region so Pakistan will become the foremost transiting country.
The corridor is one of the largest trade development projects yet. For China, the corridor is critical to the development of its western regions, which lag behind the rest of the country. So there is important political dimensions for Beijing, as well as economic. China is also desperate to get a firm footing in Central Asian markets and faster, cheaper access to the Middle East for its western regions. Pakistan sits at the crossroads between Central Asia, East Asia, South Asia, and the Arabian Gulf, so the corridor is a game-changer for the entire region. The project was of great significance for the UAE. The UAE will want to position itself to benefit as strongly as possible from the corridor and Gwadar port, which the Chinese have leased for 20 years. The UAE could be looking for equity in projects related to the corridor through investments and joint ventures, and would be keen to get into long-term commercial services agreements.
As a nuclear power sharing borders with Iran and Afghanistan, Pakistan could tip the strategic balance in favor of the GCC states if the need arose. The China-Pakistan corridor is home to a mega project and the potential for energy and other investments is enormous.