Istanbul declaration

D-8 summit meeting ended with Istanbul declaration which envisages closer economic and cultural cooperation between the member states. It was agreed to establish a” D-8 Project Support Fund “to sustain the ongoing and completed projects. The declaration underlined the progress in civil aviation and development of all modes of transportation for efficient connectivity among the member states. It also welcomed Iran’s initiative to establish a D-8 University.

During the meeting, Turkish President Recep Tayyip Erdogan called for trade with D-8 countries in local currencies to ease pressure of exchange rates on member countries. This important and feasible proposal is not reflected in the declaration. Iran and India is doing trade in their local currencies which runs into billions of dollars. The bilateral trade between these two countries continued successfully in the era of economic sanction on Iran. The open-ended exchange regime for the local currencies will boost the volume of trade. If it does materialize even then Pakistan cannot benefit much from this arrangement because of the worst economic environment created by the ill-conceived fiscal and monetary policies over the past nine years. Our finished goods, agricultural commodities and raw material will not compete with the ones supplied by other D-8 countries in terms of price and quality.

The project support fund will ensure the timely completion of development projects. However, it is not clear that the fund will be launched in a single currency like $ dollar or a basket of hard currencies to acquire capital goods from diversified sources at cheaper rates to ensure economy in the project cost. Progress in civil aviation and other modes of transportation streamline the trade but Pakistan will have to improve the service of PIA and private airlines. The railway network is in a very delipidated condition. The member states should sign agreements to do away with tariff and non-tariff barrier in the form of North America Free Trade Agreement (NAFTA). The proposal for establishment of D-8 Technology Transfer and Exchange Network(TTEN) is worth appreciation as it will expand the technological base of the member countries.

If the experience is any guide, Pakistan has not derived benefits from concession provided for its foreign trade. The previous PPP and the present PML N governments utterly failed to avail the opportunity of free access to the European Union vast market despite the GSP Plus facility given for substantially increasing its foreign trade in terms of volume and value. The inferior quality and high price of goods are the major bottlenecks. The European Union will not extend the period of GSP Plus. Hence appropriate fiscal measures need to be taken to reduce the cost of production besides quality improvement of our products with the usage of modern technologies and standardization procedures.

Easy sources for technology transfer should be explored and local technological base should be modernized and expanded for the indigenization of foreign technologies. Pakistani Engineering Universities and technology institutes do not have the necessary equipment and chemicals for new inventions, innovations and research. Public sector institutions like Pakistan Council for Scientific and Industrial Research (PCSIR) has been deliberately made redundant by not utilizing the expertise of its scientists and engineers. The provincial governments have closed large number of vocational training institutes. The government of President Musharraf approved the establishment of eight engineering universities for which the collaboration of the United States, UK and Sweden was obtained. The previous PPP government cancelled that approval. The fruits of economic integration can be reaped only when our leadership change their mind set that kills the human resource development in addition to making the economic management egalitarian. The current exploitative system inhibits the progress and prosperity despite the opening of new vistas.