Pakistan-Belarus Bilateral Relations: Discovering New Horizons

Mehmood Ul Hassan Khan

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Most recently, Belarus President Alexander Lukashenko visited Pakistan and inked lots of meaningful agreements and MOUs. It was first ever visit of any Belarusian President visit to Pakistan which showed its multidimensional importance. During his stay he met with Prime Minister Nawaz Sharif and President Mamnoon Hussain and discussed matters of mutual interests. Both sides agreed to enhance socio-economic ties in the days to come.

Pakistan: Investment-Friendly Country

While in the meeting with Alexander Lukashenko Prime Minister Nawaz Sharif termed Pakistan investment-friendly country and invited investors from across the world especially from Belarus to avail the benefit of an excellent environment for foreign investment in Pakistan. He also maintained that there was a wide scope to enhance cooperation between Pakistan and Belarus. Important agreements and MoUs would provide a structured framework for future collaboration and looked forward to several joint ventures in various areas he added.

Pakistan-Belarus Business Forum

According to Nawaz the “Pakistan-Belarus Business Forum” would benefit the entrepreneurs of both the countries. He said Belarus was an important country and Pakistan attached high importance to its bilateral relations. The Prime Minister Nawaz termed talks very productive and said it focused on bilateral relations in all fields, particularly on trade, industry, agriculture, investment, culture, education and people-to-people contacts.

New Initiatives

He said the two countries agreed on several new initiatives, besides intensifying inter-parliamentary relations and willingness to strengthen cooperation in the fight against terrorism, extremism, narcotics, and human trafficking in the days to come.

Development of Inter-Regional Relations

Prime Minister Nawaz said the two countries discussed regional and global issues and it was agreed to develop inter-regional relations to work for shared objective of peace and prosperity.

“We also agreed to continue our cooperation with international organizations and work for the UN Reform process in a manner that makes the world body more democratic, efficient and effective,” he said. He said Pakistan was keen to forge closer ties with Belarus in all fields including trade, economy, defense and culture.

Great Scope of Increasing Economic Relations

Prime Minister said the current bilateral trade between the two countries stood at $60 million and was not commensurate with its potential. He said there was a great scope for increasing economic relations in fields of textile, agricultural equipment, heavy machinery, tyres, pharmaceutical, dairy products and transport.

He said Pakistan was desirous of enhancing its collaboration with Belarus in the field of defense too.

“We need to explore possibilities for cooperation in the fields of culture and education,” the prime minister said.

President of Belarus’s Observations

The President of Belarus Alexander Lukashenko pointed that important agreements had been inked between the two countries that would go a long way towards bringing the two countries closer in future.

Invitation to different Pakistani Sectors

President invited delegations from different sectors in Pakistan to visit Belarus before the expected visit of Prime Minister Nawaz Sharif to Belarus in August this year to help identify areas of common interest.

He noted that Pakistan was an important country and said Belarus would provide the most beautiful location to Pakistan for its embassy in Minsk. He invited the Pakistani entrepreneurs to invest in different areas in Belarus.

Joint Ventures in Textiles & Garments

President of Belarus Alexander Lukashenko said joint ventures in textiles and garments can be established that can be exported to the EU countries on competitive rates. The President of Belarus is leading a large delegation that includes Deputy Prime Minister Semashko Vladimir, Minister for Foreign Affairs Makei Vladimir, Assistant to the President of Belarus Bryliov Valery and several other high ups.

President Manoon Hussain Meeting with Belarusian President

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President Hussain hosted a banquet in honour of his Belarusian counterpart. During his meeting with the Belarusian leader followed by delegation-level talks, President Hussain said Pakistan valued its ties with Belarus and both countries enjoyed a warm and a cordial relationship.

Broad-based Long term Relations

President Mamnoon Hussain said that Pakistan desired to build a broad-based, substantive and long-term relationship with Belarus in all fields, including trade, economic, education, defence and culture.

Special Economic Zones (SEZs)

The president said that Pakistan offered excellent opportunities for foreign investors with investment-friendly regulations. “Belarusian investors can make use of the incentives provided by the Government of Pakistan in the Special Economic Zones (SEZs),” he added. He noted that the holding of the first Pakistan-Belarus Business and Investment Forum in Islamabad on May 25, 2015 was a positive development. “The impressive show from both sides was an unambiguous indicator of the scope for collaboration in diverse fields of economy,” he observed.

He said that the two countries had immense potential for economic and commercial relations adding the current trade volume did not reflect the true potential and could be substantially enhanced.

Pakistan-Belarus Joint Economic Commission (JEC)

He hoped that the Pakistan-Belarus Joint Economic Commission (JEC) meeting this fall in Minsk will be beneficial for enhancing trade and economic relations between the two countries.


Close Interaction between the Chambers of Commerce and industry

He further said that there was a need to establish close interaction between the chambers of commerce and industry of the two countries and to work for the establishment of Pakistan-Belarus Joint Business Council.

Solid Foundation

He emphasized that there was great scope of increasing bilateral relations in the fields of textile, agricultural equipment, heavy machinery, pharmaceuticals, dairy products and transport and hoped that signing of a number of MoUs would provide a solid foundation for bilateral future cooperation in diverse areas between the two countries. He also called for encouraging contacts between parliamentarians of both countries as this would further the cordiality and friendship between the two countries.

Cordial Relations

President of the Republic of Belarus Alexander Lukashenko at the Aiwan-e-Sadr, the president said that Pakistan valued its relations with Belarus and both countries enjoyed a warm and a cordial relationship. He hoped that the enhanced interactions between the two countries in recent past would further increase in the times ahead.

President of Belarus

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Speaking on the occasion, president of Belarus said that Pakistan was not responsible for spread of terrorism in the world and alleging Pakistan in this regard was a misperception. He stated that his country was also keen to expand cooperation and partnership with Pakistan in all areas of mutual interest for further cementing the bilateral ties.

President Alexander Lukashenko offered to provide assistance in procuring land and construction of Pakistani embassy in Belarus. He also extended an invitation to President Mamnoon Hussain to visit Belarus. President Mamnoon Hussain accepted the invitation to visit Belarus at the earliest convenience.

Potential Areas of Cooperation

i.Automobiles: Belarus can also assist Pakistan in boosting its automobile industry. The Minsk Automobile Plant (MAZ) is a state run auto-motive manufacturer association of Belarus.

ii.Construction: Belarus has comparative advantage and expertise in cheaper and modern ways of construction which needs to be learnt.
iii.Agriculture: Belarus has expertise in agro-economy and its related equipment. Pakistan can learn lesson from its knowledge-based agro-economy.
iv.Energy: Belarus could assist Pakistan in tapping and exploring different sources/resources of energy supplies and production.
v.Information Technology: Belarus’s macro-economy is service oriented where superior knowledge of IT plays very important role which needs to be followed.
vi.Steel:
It has so many steel mills and production unit. Steel cooperation would provide win-win situation for both the sides.
vii.Household Equipment: Booming population and surge in the construction industry paves the ways for household equipment which must be tapped.
viii.Textiles: Textiles exports are the main source of revenues in the country which can be further enhanced with the help of Belarus.
ix.Meat & Dairy: Halal food is getting popular around the world. Both sides would be in win-win situation in meat & dairy sectors.

Chamber of Commerce and Industry’s Role in further Strengthening of Economic Ties

Before the arrival of Belarus President a delegation of Belarusian businessmen led by Mr. Mikhail Miatlikov, Chairman, Belarus Chamber of Commerce and Industry visited Islamabad Chamber of Commerce and Industry for Business-to-Business (B2B) meetings with Pakistani counterparts.

The delegation was representing textiles, metal industry, oil & chemicals, agri-machinery, food processing, pharmaceutical and other sectors. Ministers of Textile, Oil & Gas and Light Engineering of Belarus were also included in the delegation.

Singing of MOUs: A Giant Step

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Mr. Mikhail Miatlikov Chairman Belarusian Chamber of Commerce and Industry said that both countries have signed 12 MoUs which was a first step for starting sustainable business collaborations. He invited Pakistani businessmen to visit Belarus to explore opportunities of joint ventures and investment in his country.

Minister for Textile, Minister for Oil & Gas and Minister for Light Engineering of Belarus also addressed the meeting and desired for long-term business relations with Pakistan.

Pakistan-Belarus: Gateways

President Federation of Pakistan Chamber of Commerce and Industry said that Pakistan gave great importance to enhancing trade relations with Belarus. Both countries were gateways for each other to enter huge markets of Asia and Europe. He said Belarus should set up assembly and manufacturing plants for tractors and heavy duty vehicles in Pakistan.

Belarus: Most Industrialized Country

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Belarus locates in the heart of Europe and it is the most industrialised country. Presently, Belarus is the 30th in ease of doing business whereas, by 2018, the country will likely achieve the 21st rank for ease in doing business. Investors and businessmen from Pakistan should avail an opportunity to do business in Belarus.

Belarusian Exports to Pakistan

The exports of Belarus to Pakistan are confined to limited items including tractors, their tyres and spare parts, chemical fibres and petro chemicals. However, agriculture, energy, information technology, steel, furniture and other sectors are the potential areas of cooperation between the two countries.

Pakistan and Belarus’s Customs Union Arrangement

Pakistan’s business community can take advantage of the customs union arrangement between Belarus, Russia and Kazakhstan whereby goods imported into either one of the three states can freely cross borders between the member states of the union having a market of 200 million people.

Belarus’s Comparative Advantage

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Belarus has comparative advantage in fertilisers, dump trucks and chemicals that will improve quality and quantity for the agricultural sector of Pakistan. However, the price of machinery in Belarus is contingent on the price of metal in Russia which needs to be resolved.

Belarusian assistance to Pakistan

Belarus should assist Pakistan with technology transfer and sharing expertise, especially in the fields of energy, mining, transport, pharmaceuticals, agriculture and other technical areas. Pakistan offers lucrative incentives to foreign investors and Belarusian investors should explore the country for investment and joint ventures. Pakistan has a lot of potential in the steel industry while Belarus is producing sophisticated and value added steel products. It should consider setting up steel manufacturing plants in Pakistan to achieve lucrative returns.

Automobile Cooperation

Belarus can also assist Pakistan in boosting its automobile industry. The Minsk Automobile Plant (MAZ) is a state run auto-motive manufacturer association of Belarus. The joint venture with MAZ in manufacturing all kinds of heavy vehicles, including buses, dumper trucks, cranes and other construction machinery will increase the competitiveness of the Pakistani market in the future.

Defence Cooperation

During the Belarusian President to day official meeting, Sergei Gurulev, Chairman State Military Industrial Committee, Belarus, called on Chairman Joint Chiefs of Staff Committee Gen Rashad Mahmood and discussed matters relating to professional interest and mutual cooperation between the two armed forces.

According to the ISPR, the two agreed that there was great scope for cooperation in the field of defence industry.

Chairman of the State Military Industrial Committee of the Republic of Belarus, Sergei P. Gurulev also called on Federal Minister for Defence Khawaja Muhammad Asif.

Khawaja Asif during the meeting stressed that “By fostering ties of defence cooperation both Pakistan and Belarus can benefit from each other’s capabilities and technology”. He added that “We can enhance the level of cooperation and interaction among our defence forces by offering training courses at military institutions”.

Belarus’s Expected Defence Cooperation: Armored Personnel Carriers (APCs), Industry Combat Vehicles, Tanks T-72 and T-80 & MAZ and BELAZ Dump Trucks.

Pakistan’s Expected Defence Cooperation: Infantry Weapons, Small Arms, Ammunition, Artillery Ammunition and Night Vision Devices

Previously, representatives from the two countries explored areas for military cooperation at the 7th International Exhibition of Arms and Military Machinery (MILEX-2014) which took place in Minsk, Belarus. The government of Pakistan also interested in “establishing mutually beneficial cooperation in the field of defence production.” Pakistan invited Belarusian to the 8th International Defense Exhibition and Seminar (IDEAS-2014).

Under President Lukashenko, the Belarusian defense industry has developed particular skill in maintaining and upgrading legacy Soviet-era equipment. Belarus has also historically been skilled in military radio technology.
Agricultural Cooperation

Prospects of agricultural cooperation between Pakistan and Belarus are very bright. Pakistan is an agricultural country which is in need of Belarusian agricultural machinery, particularly tractors and their spare parts. The current government of Belarus is focusing on an agro-policy that has increased the production of wheat, rice and sugar. Pakistan can learn lessons from the Belarusian agro-policy in order to improve its production in the agricultural sector. Moreover, the “Bilateral Investment Treaty (BIT)” between Belarus and Pakistan has been ratified. In last 5 years 30,000 tractors were sold to Pakistan.

Suggestions

Pakistan and Belarus have signed agreements on trade-economic cooperation, investments protection and avoidance of double taxation. It was agreed in the meeting the Belarusian investment could help Pakistan to lead and generate more employment opportunities as well.

Pakistan and Belarus share a cordial history of bilateral relations in economy, trade and defence. Both countries are maintaining agreements on trade, economic cooperation and investment protection. The visit of the Belarusian president would strengthen the economic and cultural ties between the two countries. Trade volume between Pakistan and could be improved significantly by encouraging a frequent exchange of business delegations.

The present regime is looking for new markets and trade partners around the globe in order to increase trade & commerce activities of the country. Belarusian President’s visit is a reflection of the vision for seeking new horizons for imports and exports. Pakistan aims to bolster economic, commercial and strategic relations between Pakistan and Belarus.

i. Pakistan has asked Belarus to initiate the process of entering into a free trade agreement (FTA) in an effort to streamline development of trade ties between the two countries. Finalization of FTA would bring the desired goals of greater socio-economic integration in the days to come.
ii. Setting up Belarusian plants in Pakistan for the manufacture of automobile parts and assembly of buses, tractors and grain harvesters would be a value-addition for agro-economy of Pakistan.
iii. Belarus must also consider technological upgrade and expansion of existing facilities in different sectors in the country which would further strengthen the bilateral relations.
iv. Pakistan’s industrial parks should be used for trade and investment opportunities and Belarus would be allowed to export manufactured and assembled products from Pakistan to regions across the globe.
v. Pakistan and Belarus have agreed to enhance bilateral trade up to the mark of one billion dollar per annum in Textile, oil and gas chemicals and other sectors. In this regard, Pakistan Federation of Chambers of Commerce and Industry and Belarus Chambers of Commerce have signed an agreement to further promote their collaboration. Existing bilateral trade potential between the two countries is $ 60 million which is enough. Pakistan’s exports to the Belarus are $ 15 million while its imports from Belarus are $45 million. Non-competitive environment and limited products are the key reason behind limited trade volume. Pakistan is one of the key markets for Belarusian tractors outside the CIS. In addition to tractors Belarus’ major exports to Pakistan also include potash fertilizers, synthetic fibers, and tires. From Pakistan Belarus imports rice, fruit, food, leather and textile.
vi. Business council and National Chambers between the two counties may fruitful to promote collaboration in bilateral trade.
vii. Pakistan and Belarus can enhance economic cooperation through business-to-business (B2B) meetings, exhibitions, and sending experts under the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) platform.
viii. A joint Chamber of Commerce and Industry between the two countries could also improve trade relations between the two countries. This act will secure the commercial interests of the business communities of both sides.
ix. Both countries should understand their market demands and potentials and make efforts to reduce the communication gap. Pakistan had a strong textile, cotton and rice market.
x. Both countries can promote trade in fertilizer, chemicals and textile sectors. Joint ventures and inflows of Belarusian FDIs can be handy for Pakistan’s local industries and increasing of its exports to Belarus.
xi. Finalization of “investment treaty” could a game changer for both sides. Both counties can promote economic cooperation. Pakistan is ideal country for investment and investors from Belarus should initiate joint ventures in telecom, Engineering, Power generation, oil and Gas, Textile, Automobile, fertilizer plants and chemical technology.
xii. Great scope for higher and scientific education cooperation. A two-member delegation of scientists visited to Belarus during which memorandums of understanding (MoUs) were signed for exchange of scholars and students and for finding common ground for promotion of higher education. It was the first visit of a Pakistani scientific delegation to Belarus. The visit was arranged by the newly opened Belarusian embassy in Islamabad. It may be added that the President of Belarus is also scheduled to visit Pakistan in the near future.
xiii. There is an urgent need to start jointly working in the field of technical education, making a soft visa policy, encouraging the banking sector, starting direct flights, promoting tourism, and signing MoUs.
xiv. Investment in the agriculture machinery sector could be a healthy offer and collaboration with the Pakistan Military organisations in the production of heavy vehicles would be very useful.
xv. Services and industrial products are hallmark of Belarus economy and its tractors are famous in Pakistan. Belarusian tractors, trucks, motorcyles, earthmovers, fertilizers, machinery and mineral products, chemicals, metals, textiles, metal-cutting machine tools, synthetic fibres can be exported to Pakistan due to its demand.
xvi. Promotion of mutually advantageous commercial and industrial interests between the two countries would pay dividends in the days to come.
xvii. Establishment of Special Economic Zones (SEZs) for Belarusian companies, investors and businessmen would brighten the prospects of joint ventures and inflows of FDIs from Belarus.
xviii. Planned establishment of railway links between Pakistan and Turkey would facilitate promotion of trade as it would shorten the route and provide better access to Pakistan to Scandinavian countries.

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