Trade stalls across divided Kashmir

By Athar Parvaiz

Trade and travel between the Indian and Pakistan parts of Kashmir allowed to a limited extent as part of confidence-building measures between the two rival countries appear to have become a casualty of the terror attacks last November on India's financial center of Mumbai.

This is despite Indian Foreign Minister Pranab Mukherjee immediately after the attacks vowing that the "Kashmir-centric" confidence-building measures would not be affected by the terror strikes, which left 180 people dead.

Trade between the divided parts of Kashmir, which had started in October 2008 but was struggling thanks to the lack of infrastructure and facilities, might have improved but for the renewed acrimony between India and Pakistan over the Mumbai attacks, according to traders.

Over the past three years, India and Pakistan began a number of confidence-building measures as part of a peace process. These included the reopening of the Srinagar-Muzaffarabad highway, sealed since 1947 when the disputed territory was carved up between India and Pakistan.

In 2005, India and Pakistan agreed to reopen the highway to allow families divided by the Line of Control (LoC), the de facto border, to cross to meet their kith and kin. By 2008, warming relations between the two countries allowed the opening of the road across the LoC to trade as well.

The volume of trade cross the rugged terrain was limited and on a barter basis, but traders in Srinagar appreciated the measure and had hopes that it would expand with time.

"We were told that all the facilities regarding the facilitation of trade between the two parts of Kashmir would be put in place by the end of 2008, but nothing of the sort happened,'' Mubeen Shah, president of the Kashmir Chamber of Commerce and Industry, told Inter Press Service (IPS).

"The fact is we are yet to settle the account of the trade items which we have exchanged on the occasion of resumption of trade across the LoC on October 21, 2008.''

Several demands by the traders are pending. The most significant is the restoration of telephone links between the divided parts of Kashmir and the setting up of bank branches at cities such as Srinagar and Jammu in Indian-administered Kashmir and Muzaffarabad and Mirpur in Pakistan-administered Kashmir.

"The chief minister [of India-controlled Jammu and Kashmir] Omar Abdullah has himself stated many times that trade across the LoC was meaningless unless traders were able to exchange phone calls. The government should do some practical work to ensure it,'' said Shah.

"Communication facilities for Kashmiris stand snapped for decades even as people elsewhere in India and Pakistan can make or receive phone calls to each other,'' said civil rights activist Hameeda Nayeem. ''People on this [Indian] side of the divided Kashmir can only receive calls from the other side, but can't make calls from here," she said.

Nayeem asserts that exchange of business ideas is a basic requirement for trade to flourish. "And it has not been helpful for confidence-building that there are no facilities to allow money transactions.''

Shah is worried by the fact that trade has been mostly confined to traders who happen to have relations on the other side of the LoC. "This is mainly because no trader wants to risk his goods. Traders need to be assured about costs and profits. Since there is no security, traders hesitate to send across goods,'' Shah said.
"At present, the trade goes on only in a cosmetic and subdued manner. We are having problems reconciling accounts. For example, our fruit growers sent fruit worth three million rupees [US$58,600] in the first consignment, but they didn't get what they consider the equivalent in return through the barter system."

Observers expect no improvement on this front at least until general elections in India slated for April are over as political parties focus more on rhetoric than on peace-making with Pakistan.

"The present United Progressive Alliance [UPA] government [a coalition of more than a dozen political parties led by the Congress party] - is wary of the opposition alliance, the National Democratic Alliance led by the right-wing, pro-Hindu Bhartiya Janata Party [BJP], which slams it for any softness regarding Pakistan or Pakistan-backed Kashmiri pro-freedom leadership," said political analyst Noor Baba.

"At this point in time, the UPA government would not like to take any risks which may give a handle to the BJP as the parties gear up for the elections,'' Baba said. ''It would rather focus on those issues which would better its prospects in the general elections."

The Indian government is putting pressure on Pakistan to do more on the Mumbai terror strikes. India believes the plan was entirely orchestrated in Pakistan, and Islamabad recently admitted that the plan was partially devised there.

"The Indian government cannot afford to relent and will try its best to sustain the pressure so as to better its chances in the upcoming elections," Baba told IPS. ''The Congress-led coalition government has to do this in order to deny leverage to the BJP."

The chances of the Indian government resuming peace talks with Kashmiri separatist leaders appear bleak, especially after the successful conclusion of state assembly elections.

During her recent visit to Kashmir, UPA chairperson Sonia Gandhi called on separatist leaders to take part in the democratic process, indicating the "massive people's participation" in the assembly elections - which saw a coalition of the Omar Abdullah-led National Conference and Gandhi's Congress party coming to power.

The central government and pro-India political parties were encouraged by the good voter turnout in Kashmir, especially when the elections were held amid a wave of anti-India sentiment triggered by the allotment of land to a Hindu shrine board in May 2008. Dozens of people were killed and hundreds injured in protests and clashes that followed.

Kashmir continues to simmer. On February 22, two youths were shot dead and another seriously injured allegedly without provocation by security forces. Earlier in the month, a youth was killed in Lolab, north Kashmir, and another in Kuil-Pulwama.

These killings have led to demands by political parties and rights activists for the revocation of the draconian Armed Forces Special Powers Act. "The special powers give the security forces a sense of impunity and they go to any extent, including killing of innocent people,'' said Mehbooba Mufti, leader of the opposition Peoples' Democratic Party.