Prime Minister Nawaz Sharif recently officially visited the Republic of Belarus and met with Alexander Lukashenko, Prime Minister and other high officials. Both leaders discussed wide range of issues relating to greater socio-economic integration, technology transfer and trade. Both sides also shared commonality of views on various regional and international issues and expressed satisfaction over the visible growth and development in bilateral ties. Both leaders also charted the roadmap for further strengthening of bilateral relations in the days to come.
This was the maiden visit of any Pakistani head of the government to Belarus. During recent times, the momentum of bilateral ties has been increasing by each passing day.
Pakistan values its relations with Belarus and both countries enjoy a warm and a cordial relationship. Prime Minister Nawaz hoped that the enhanced interactions between the two countries in recent past would further increase in the times ahead. Being one of the most advanced industrial countries Belarus helped Pakistan to establish tractor factory in Karachi in 1962.
Agreements & MOUs
During his visit, a number of agreements and Memorandums of Understanding (MoUs) were signed to strengthen bilateral ties through the development of trade, commerce, education and culture. The other document inked was Memorandum of Cooperation for Translation and Publication of Classical Literary Works of Pakistan and Belarus.
The two leaders also agreed on forging closer ties in the areas of trade, defence, education and culture as they inked another set of agreements in a short span of over two months. The agreements were signed at the Presidential Palace following a round of delegation level talks and an exclusive one-on-one meeting of Prime Minister Nawaz Sharif with President Alexander Lukashenko.
First Round of Agreements
It was the second round of agreements inked between the two countries, the first being done in May 2015 at Islamabad, where 20 documents were signed during the official visit of Belarusian President Alexander Lukashenko. Earlier both countries had agreed to cooperate in the fields of economic, military and technical assistance, science and technology, information and telecommunications in May 2015. President Lukashenko and Premier Nawaz had also signed the Islamabad Declaration of Belarus-Pakistan partnership.
PM Nawaz said that Pakistan was keen to forge closer ties with Belarus in all fields, including trade, economic, defence, and culture. “There is great scope for increasing economic relations in the fields of textile, heavy vehicles, agricultural equipment, heavy machinery, pharmaceuticals and dairy products” he added.
Joint Press Conference
Speaking at the joint press conference with the president of Belarus, PM Nawaz Sharif said that working in tandem would unlock vast potential of mutually beneficial cooperation. Belarus President Alexander Lukashenko said on the occasion that the two countries agreed to enhance bilateral cooperation in fighting extremism and various other fields.
Speaking to Belarusian President Alexander Lukashenko during delegation-level talks in Minsk, Nawaz particularly mentioned trade, defence and economic sectors to forge ties between the two countries, Radio Pakistan reported.
The two leaders exchanged views on cooperation in trade, agriculture, investment, culture and education sectors.
Joint Ventures
Pakistan and Belarus agreed to initiate joint ventures (JVs) in the textile, pharmaceutical and lighting solution industries while sharing technological expertise with each other.
In the meeting of the First Pakistan-Belarus Joint Economic Commission (JEC) that took place during Commerce Minister Khurram Dastgir’s visit to Belarus prior to the recent visit of PM of Nawaz Sharif the modalities of these joint ventures were discussed.
It is hoped that these ventures would open up new avenues for greater cooperation in diverse fields through private-public partnerships. Both sides expressed their resolve in undertaking concrete measures to enhance the volume of trade in the days to come.
Dastgir and Belarus Minister for Commerce and Industry Vitaly M Vovk reviewed the entire spectrum of bilateral relations between the two countries and expressed satisfaction at the current volumes of bilateral trade. Both reiterated their desire to further fortify relations.
Feasible Air & Sea Routes
Dastgir also emphasised the need to establish economically feasible air and sea routes for swift delivery of cargo. “Since Belarus is land-locked, the establishment of air-link is necessary for the exports of perishable items that have great demand in Belarus,” he said.
Pakistan’s Board of Investment (BoI) Chairman also apprised the prospective Belarusian investors of the emerging investment opportunities in Pakistan.
Bilateral Trade (2014)
According to official figures, Pakistan exported $15.23 million worth of items to Belarus in 2014, out of which 36 percent was rice, 9.27 percent light pure woven cotton, 10.03 percent styrene polymers, 7.43 percent edible preparations, 4.48 percent leather apparel and 4 percent citrus.
Pakistan’s imports from Belarus stood at $42.65 million which mainly consisted of tractors (62.04 percent, artificial filament yarn 13.01 percent and rubber tires 8.06 percent.
During the three-day visit, premier participated in the Pakistan-Belarus Business and Investment Forum and visited several industrial units.
Visit to Belarusian Chamber of Commerce and Industry
PM Nawaz visited the Belarusian Chamber of Commerce and Industry and explored different avenues for greater cooperation in different fields of mutual benefits. He also addressed the Belarus State University in Minsk where he also received an honorary doctorate, stressed upon the need for cordial ties with its neighboring countries. He also discussed the importance of higher education in both countries, hoping that cooperation between universities would increase the scope of educational activities.
He said Pakistan considers peace and enhancement of regional trade essential for regional prosperity and mentioned the Pakistan China Economic Corridor which he said would change the dynamics of the region especially with its connectivity projects.
“Our region also has ample opportunities of cooperation in the field of energy. We can all reap harvest from various energy projects in the region such as CASA 1000 and the Turkmenistan Afghanistan Pakistan India (TAPI) gas pipeline project.”
Belarusian FDI in Power Sector
He expressed his desire to expand foreign direct investment (FDI) in Pakistan’s power sector as well as in the development of infrastructure and mining, oil and gas exploration sectors. During his speech PM Nawaz reiterated Pakistan’s ongoing efforts to eliminate terrorism from the country. “Pakistan stands fully committed in eliminating terrorism and we will not allow our territory to be used by any terrorists, irrespective of their nationality and ethnicity.”
He said the military operation “Zarb-e-Azb” would continue till elimination of terrorism from the country.
He said the trade volume of $ 60 million was not reflective of the true potential and can be substantially increased. Stressing the need to work together for strengthening of trade ties, he said the two countries can explore possibilities of joint ventures.
He said Pakistan offers excellent opportunities for foreign investors and has investment-friendly regulations for a market of nearly 200 million people.
Cheap Labour
He said Pakistan not only provided cheap labour, but also offered great incentives for investment. He said Pakistan also was a gateway to the Middle East and a larger market for industrial goods.
He invited the Belarusian investors to benefit from the incentives provided by the Government in the Special Economic Zones.
The PM also expressed satisfaction over the outcome of the first Pakistan-Belarus meeting of the Joint Economic Commission (JEC) and Pakistan-Belarus Business Council and said it can prepare the ground work for building a strong foundation to expand cooperation in many new areas.
Meeting with Belarusian Prime Minister
Prime Minister Muhammad Nawaz Sharif, met with the Prime Minister Andrei Kobyakov at the House of the Government, said there was wide scope for increasing interaction in many areas between the two countries.
He agreed with the proposal of Belarusian Prime Minister of tasking the Belarus Pakistan Joint Economic Commission to prepare a road map by September 2015.
The Belarusian Prime Minister said he saw relations between the two countries move to a far higher level in one year’s time, keeping in view the progress achieved so far. He said a solid foundation will provide opportunity to both the sides to boost economic, trade and commercial cooperation.
Belarus Pakistan Joint Economic Commission
He called for preparing an intensive schedule for the Joint Economic Commission so that a solid package of proposals can be finalised for cooperation in agriculture and industrial sectors of Pakistan.
He also offered his county’s support to Pakistan in the infrastructure projects along the China Pakistan Economic Corridor (CPEC).
Prime Minister Nawaz Sharif said the bold initiative of President Alexander Lukashenko has fast tracked the ties between the two countries and in a matter of little over two months the two countries have made good progress. He said the high level exchanges were a positive sign and need to be continued.
Important Visit to Belaz
Prime Minister Nawaz Sharif visited Belaz, the world’s largest mining truck manufacturer with the latest model capable of carrying over 450 tons, and was impressed with what the equipment could achieve in the mining sector.
He said Pakistan could benefit from the company while he was shown around the plant that manufactures one in three of the dump trucks produced globally.
The PM evinced keen interest and asked several questions about the various processes involved. The company produces majority of the components at the local plant.
He was also briefed about the manufacturing facility and informed that the company had made it to the ‘Guinness Book of World Records’ and had no competitors.
“I am very impressed to see the facility, the expertise and technological advancement and I am sure Pakistan will be one of the countries benefitting from Belaz trucks,” said Sharif.
The 26ft (8.2 metres) high truck has a top speed of 40mph (64km/h) and can still travel at 25mph (40km/h) while climbing a 10 percent gradient. It has a diesel-electric transmission system and two 16-cylinder diesel engines drive generators which produce electricity to power four electric motors. It consumes an estimated 1,300 liters of fuel per 100km. The ‘Belarusian Autoworks’ is one of the leading producers of construction machinery and vehicles for open-pit mining.
In 2013, the company rolled out the world’s largest mining truck with carrying capacity of 450 tonnes and recorded a lifting capacity of over 503 tonnes.
Since established, the company has designed more than 500 modifications of vehicles and manufactured over 135,000 huge trucks that are now being operated all over the world. Belaz branded equipment operates in 70 countries around the world. The company also manufactures road construction vehicles and mining and transport equipment service vehicles like loaders, bulldozers, concrete mixer trucks, scrapers and tows trucks.
Concluding Remarks
Pakistan and Belarus share a cordial history of bilateral relations in economic, trade and defence. Both sides are maintaining agreements on trade, economic cooperation and investment protection. Series of high officials’ visits have already strengthened the bilateral relations between Pakistan and Belarus. Trade volume between Pakistan and could be improved significantly by encouraging a frequent exchange of business delegations.
Pakistan and Belarus have signed agreements on trade-economic cooperation, investments protection and avoidance of double taxation. The Belarusian investments could help Pakistan to lead and generate more employment opportunities as well.
Both countries are in search of new markets and trade partners in order to achieve desired goals of socio-economic prosperity and greater connectivity through commercial diplomacy. A solid foundation has been provided by series of high officials’ visits and signings of so many agreements and MOUs which needs to be followed and implemented in true letters and spirits.
Pakistan desires to initiate the process of entering into a free trade agreement (FTA) which needs to be inked as soon as possible because finalization of FTA would bring the desired goals of greater socio-economic integration in the days to come.
Greater industrial cooperation by 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. It would also promote Belarusian tractors and other vehicles in Pakistani markets. Belarus must also consider technological upgrade and expansion of existing facilities in different sectors in the country which would further strengthen the bilateral relations.
Pakistan’s industrial parks may be used for trade and investment opportunities. Furthermore Belarus would be allowed to export manufactured and assembled products from Pakistan to regions across the globe.
Both sides have agreed to further enhance bilateral trade up to the mark of one billion dollar per annum in Textile, oil and gas chemicals and other sectors. Pakistan Federation of Chambers of Commerce and Industry and Belarus Chambers of Commerce have also signed an agreement to further promote their collaboration. Frequent visits of business delegations and investors would be helpful for greater socio-economic connectivity.
Existing bilateral trade potential between the two countries is $ 60 million which is not so healthy. Non-competitive environment and limited products are the key reasons behind limited trade volume. Pakistan is one of the key markets for Belarusian tractors outside the CIS. Belarus’ major exports to Pakistan also include potash fertilizers, synthetic fibers, and tires. From Pakistan Belarus imports rice, fruit, food, leather and textile. There is urgent need to explore and diversify the imports-exports mix between the two countries. Exchange of non- traditional items may also be considered.
Pakistan and Belarus may 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. In this regard, a joint Chamber of Commerce and Industry between the two countries would also improve trade relations. Better understanding of their markets demands and potentials and reducing of communication gap would be game changer.
Keeping in view comparative advantages of both countries can accelerate trade volumes. Cooperation in fertilizer, chemicals and textile sectors could bring desirable goals. Joint ventures and inflows of Belarusian FDIs in these sectors/commodities can be handy for Pakistan’s local industries and increasing of its exports to Belarus.
Pakistan is an ideal country for investments and investors from Belarus may initiate joint ventures in telecom, engineering, power generation, oil and gas, textile, automobile, fertilizer plants and chemical technology.
There is a great scope for cooperation in higher education including science and technology, bio-chemistry, bio-gas etc. which must be tapped as soon as possible.
There is an urgent need to start joint working in the field of technical education, making a soft visa policy, encouraging the banking sector, starting direct flights and promoting tourism. 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.
Establishment of Special Economic Zones (SEZs) for Belarusian companies, investors and businessmen would brighten the prospects of joint ventures and inflows of FDIs in the days to come. Moreover, 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.
Sincere efforts should also be initiated to identify future joint projects between the two countries. The Minsk Automobile Plant (MAZ) is a state run auto-motive manufacturer association of Belarus which may lead to start any industrial project. Belarusian cheaper and modern ways of construction needs to be learnt and promoted in Pakistan. It could assist Pakistan in tapping and exploring different sources/resources of energy supplies and production. Its macro-economy is service oriented where superior knowledge of IT plays very important role which needs to be institutionalized. Moreover, Belarus has many steel mills and production units; steel cooperation would provide a win-win situation for both sides. Pakistan Steel Mill is at its lowest ebb of production and steel cooperation between the two countries could make it more efficient and productive in the days to come.
