Pakistan, for the first time, is considering using the land route via China, Kyrgyzstan and Kazakhstan, made under the quadrilateral agreement, for export to Russia. The route made to link the four countries through an agreement was being considered as an alternative way for export to reach the Russian market especially it eastern part, sources told Business Recorder on Friday.
Pakistan's goods, which are exported via Shahra-e-Karakoram to China, then to the two Central Asian Republics (CARs) could easily cross the Russian border with comparatively lesser freight cost, they added. According to sources the trade related issues including the establishment of land route was also likely to be discussed during an expected visit of President Asif Ali Zardari to Moscow due shortly.
The issue, along with other possible ways to improve trade with Moscow, sources said, also came under discussion in a recent meeting at the Trade Development Authority of Pakistan (TDAP) comprising the representatives of Pakistan-Russia Business Council of FPCCI.
The main objective behind the move, as sources said, was to reach the Eastern or Siberian Russia, which contrary to the common knowledge, has cities with sizeable population remained neglected by Pakistani exporters. These cities with comparatively middle to lower income segments of population are more suitable for Pakistan's exports.
Pakistan, which has traditionally focused on the European part of Russia, was needed to shift its focus on the eastern side of that country as under the existing balance of trade between the two countries Pakistan was at a highly disadvantageous position. To resolve the high freight issue in the trade with Russia, the land route, which would drastically reduce the freight cost, was considered as an alternative, sources said.
As China and the two Central Asian states have a land route links with Russia, Pakistan, enjoying the Quadrilateral Agreement and Free Trade Agreement (FTA) could also improve the trade relations with Moscow through using the same routes. China has also highly established Rail made links with Moscow which ensures lower freight and timely delivery of Chinese products in the Russian market. With enjoying an ideal access to the whole of southern part of Russia, China has captured the major share of Russian market in that region.
The main hurdle in the trade links with Russia, according to sources, was the current stoppage of Karakoram Highway at Attabad, Hunza after the land slide since January 4, and the deteriorated law and order situation in Central Asia. To improve the over all export to Russia, they said, TDAP was also going to participate number of fairs like Expo Stone, Russia from June 22 to 25, 2010, Federal Textile Fair, Moscow, September, Heimtextile Russia in September, Le Show, May 2011and Expo Stone June 2011.
A delegation of traders/exporters, organised by TDAP, would also visit Russia by the end of this month to examine the possibilities of trade improvements through exploring new markets in the foreign country especially the Europe and Asian provinces of Russia, they added.
It is pertinent to mention here that the quadrilateral agreement was signed in 1995 and implementation process was started after nine years. All the four countries under the agreement had waived-off the transit fee and toll charges on the traffic-in-transit, to improve the trade volume between the four countries.