Cross-Kashmir trade mired in problems

Last Updated: Sun, Dec 04, 2011 07:20 hrs

Jammu, Dec 4 (IANS) Cross-Kashmir trade across the Line of Control (LoC), that began as a much vaunted confidence building measure between India and Pakistan three years ago risks becoming a victim of poor planning and implementation, stakeholders say.

Cross border trade, allowed in December 2008, was the culmination of a number of peace initiatives, including the 2003 ceasefire between the Indian and Pakistani armies and opening of two routes in 2005 for divided families living on either side of the LoC that divides India and Pakistan-administered Kashmir.

The trade is going on from two points in the state -- Chakan-da-Bagh in Poonch district of the Jammu region and Salamabad in Baramulla district of the Kashmir valley.

Since both the areas are remote and underdeveloped, it was hoped that the move would create employment and spur growth in the region.

'Besides employment and development, strong emotions of both sides of Jammu and Kashmir were attached to this trade. Even before the partition of the country in 1947, we used to have trade between Poonch and Rawalkot (in Pakistan),' Poonch resident Subash Raina said.

But the trade is facing a host of problems.

Nishu Gupta, a trader in Poonch, told IANS over phone: 'We are facing a lot of problems with this (cross LoC trade). Though Pakistani traders can call us on telephone, the Indian government is not allowing calls from this side to Pakistan.'

Advocate Iftikar Bazmee remarked: 'This trade has not lived up to the aim and expectations it started with. The people of Poonch have hardly had any economic benefit, nor did it create many job opportunities. This trade was mainly started for locals but traders from Punjab and Haryana are benefiting more.'

He alleged that traders from these neighbouring states are carrying out proxy trade via agents in Poonch as 'this trade is tax free'.

On paper, only local registered traders can do cross LoC trade. There are about 170 registered traders in Poonch.

The other main problem being faced is there is still no agreement on the currency to be used in this trade. Hence, it is being run on barter.

'No trade can succeed without the involvement of banks. There is no unanimity on currency and we cannot use dollars as it is used in international trade,' an industries and commerce department official told IANS on condition of anonymity.

Bazmee said while it was agreed upon that trader delegations would visit each others' countries regularly, 'this has not been allowed till now'.

Additional Deputy Commissioner of Poonch Matloob Khan told IANS that up to Oct 31, 2011, about 3,800 truckloads of goods have gone to Pakistan from the Indian side and about 3,700 trucks have come from across the border.

Trade from the Indian side was worth about Rs.179 crore ($35 million), while that from Pakistan was Rs.300 crore in Pakistani currency ($33 million).

Commenting on the figures, president of Chamber of Commerce and Industry in Jammu Y.V. Sharma said: 'We cannot term this as trade in the real sense of it from any yardstick. This is just carrying forward confidence building measures. All I can say is that the traders have found a way for doing cross LoC business which has more emotive value.'

(Binoo Joshi can be contacted at

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