India’s Withdrawal of MFN Status to Pakistan: Ceding More Space to China

In the wake of the Pulwama attack in Jammu & Kashmir against Indian paramilitary forces, the Indian government has withdrawn the Most Favoured Nation (MFN) status for Pakistan. This status had been accorded to Pakistan on the basis of India’s obligations under the World Trade Organisation. The former had, however, never reciprocated and it is only now that New Delhi has sought to respond in kind. [1]

While this is seen as a strong signal of sorts to the Pakistanis, it is unlikely to be so given the abysmally low level of Indo-Pak bilateral trade.

According to the UN Comtrade Database, Indo-Pak trade stood at US$1.992 billion in 2015, just about crossed the US$2 billion threshold in 2016 and in 2017 had not increased by more than a few tens of millions of dollars over the previous year. Pakistani exports to India in this period stayed between US$310 million and US$350 million. By contrast, Sino-Pak trade in 2015 stood at nearly US$13 billion with Pakistan suffering a deficit of some US$11 billion. In 2016, trade went up to US$15.3 billion with not just Pakistani imports rising but its exports to China also falling worsening its deficit. This trend continued even as Sino-Pak trade rose to nearly US$17 billion with Pakistani exports to China constituting just a shade over US$1.5 billion.[2] Continue reading India’s Withdrawal of MFN Status to Pakistan: Ceding More Space to China

On Democratic Space and Aggressive Foreign Policy

Indian analysts and officials frequently differentiate their country from China on the basis of the political systems of the two countries. It is seen as positive that India is a democracy despite the poverty, superstitions and lack of education of a large number of its people. China however is looked down upon despite its many achievements in living standards and social indicators because it is an authoritarian state.

Nevertheless, it is also common to find among sections of Indian elites an admiration for China’s ‘tough’ ways; for the ‘discipline’ of its people. It is often proposed that India, too, needs a tough leader with authority to ensure that corruption and other ills are eliminated and the country reaches the front rank of nations, which it deserves. A question left unaddressed is whether the objective of becoming a world power is an end in itself or designed to help India to the means to improve its domestic conditions. Continue reading On Democratic Space and Aggressive Foreign Policy