Azerbaijan and Pakistan completed 25 years of bilateral relationship and cooperation that extends to every sphere ranging from political, economic, technological, security to cultural arenas. The relation is based on a concept of “shared prosperity” and on rigorous commercial diplomacy and is consolidated on greater socio-economic connectivity, better political understanding and geo-strategic cooperation and increasing military cooperation. Both countries have unlimited opportunities for further strengthening of bilateral relations.
Prime Minister Nawaz Sharif went on an official visit to Azerbaijan from oct. 13 to 15, 2016 where discussions on the highest level were undertaken to increase and strengthen development of bilateral cooperation. Pakistan wants to strengthen relations with Azerbaijan in various fields, to raise their level from friendly relations to strong economic partnership. The strengthening of socio-economic ties and the development of trade and business relations between Azerbaijan and Pakistan will be beneficial to both.
The current level of cooperation provides a win-win proposition for both the countries. For Pakistan, the strategic alliance with Azerbaijan offers a degree of recognition of Pakistan’s bid to become a more active, assertive and powerful regional actor. for Azerbaijan, Pakistan is also an important diplomatic supporter and more recently, a key military partner.
In the near past, due to exchange of a series of high level visits, political relations between Azerbaijan and Pakistan are now at a high level. Both states have supported each other on the international forum; Pakistan supports Azerbaijan’s position on the Nagorno-Karabakh conflict, condemning the aggressive policy of Armenia. Moreover, Pakistan was the first country to adopt a resolution strongly condemning the genocide committed by Armenian armed forces against the civilian population of Azerbaijan’s Khojaly town and urging the international community to force Armenia to fulfill un Security council resolutions. The Senate of Pakistan also recognized the events in Khojaly as genocide. Pakistan fully supports Azerbaijan’s territorial integrity and has not yet recognized Armenia as an independent state in connection with its occupation of Azerbaijan lands. Azerbaijan supports Pakistan on the dispute of Kashmir.
Azerbaijan and Pakistan bilateral relations were established 25 years ago and today both are strategic partners. The Azerbaijan-Pakistan friendship was founded by two H.E. Heydar Aliyev, the founding father and first president of Azerbaijan and Benazir Bhutto. Now H.E. Ilham Aliyev is desirous of a strategic partnership with Pakistan.
Both countries have had cultural, social, religious and civilizational ties through the Silk Route in the past. Caravans from both regions used this route extensively for trading purposes. Now, a corner of Azeri culture has been established in Look Versa in Islamabad and Azeri students are studying in Pakistan. Pakistani students are also taking education in Azeri institutes.
Bilateral relations between Azerbaijan and Pakistan are constantly on the move adding trade and economic ties which have already been given new dimensions. Exchange of visits of Azerbaijan and Pakistani leaders as well as the other high level delegations played a pivotal role in cementing the links between the countries and people alike. Agreements in political, economic, strategic, social, humanitarian, cultural and other sectors signed during these visits formed a solid legislative base.
Both countries have reiterated further strengthening existing bilateral ties through enhanced interaction between the parliaments and people through rigorous commercial diplomacy, regional connectivity and greater socio-economic integration. Both countries are also very keen to further enhance bilateral, economic and commercial relations with special focus on improving the deteriorating energy situation in the country. Economic diplomacy is the mantra of both the countries and in this regard effective measures and mechanism have already been initiated to take advantage comparative advantages of each other.
At present, the political relations between Pakistan and Azerbaijan are excellent. The bilateral trade between the two countries is only US$ 22 million in 2012-2013 that is far below their potential. It is hoped that taking effective trade facilitation measures, including easing travel by improving communication and transportation links would be instrumental for further enhancing of trade volumes.
Azerbaijan would increase its airline fleet to establish direct airline between Islamabad and Baku which would bring people of the two countries closer to each other. It is hoped that Pak-Azerbaijan Business Forum would open new avenues of cooperation.
The construction sector is one of the fastest growing areas of Azerbaijan’s economy as it is in process of constructing huge buildings and a new island that provide investment opportunity of about $130 billion. The two countries also have a potential of joint ventures in pharmaceutical, agriculture and manufacturing sectors.
Pakistan can export to Azerbaijan its value-added agricultural products like mangoes, dates, fruits, sports and surgical goods. Pakistan’s Basmati rice has a huge demand in Azerbaijan. The establishment of joint businesses between Pakistan and the Republic of Azerbaijan could enhance the trade volume between these two countries 100 times greater than the existing minimum level of trade. All the chambers of commerce in the country are of the view that our energy deficit could be overcome by trading with Azerbaijan. Pakistan could import lubricants, oil and gas, and other petroleum products from Azerbaijan.
Establishment of the Pakistan Azerbaijan Business Forum will facilitate. Businessmen, investors and industrialists of the two countries in future decision-making. It will be a game-changer in further deepening bilateral relations in the fields of economic integration, trade & commerce, energy cooperation and educational exchange in the days to come. It is hoped that private sector of countries would be in a better position to invest and initiate joint ventures in the diverse fields of economy and production and extend their mutual, pharmacy, agriculture, sports and Science & technology. The Azerbaijan govt has stressed the need to collectively work on legal tax regime in der to avoid double taxation.
There exists tremendous opportunities for Azerbaijani and Pakistani investors and in terms of economic relations there exist multiple unutilized opportunities that could be tapped for strengthening relations. For instance, the level of annual trade between the two countries in the last 5 years remained between US$ 17 to 25 million, which does not correspond with the level of existing bilateral political good will between the two. Both must move in the direction of non-tariff arena in order to accelerate socio-economic relations in the right direction. Introduction of multiple joint ventures can be initiated in the field of pharmaceutics, textiles, JCT, infrastructure and education, etc. Both governments can facilitate companies to get registered to make them able to introduce their products.
In terms of infrastructure development, Azerbaijan is way ahead of Pakistan and currently the Government of Pakistan is under taking massive mega infrastructure projects attracting investors. Being in a better position Azerbaijan can invest and earn from Pakistan’s infrastructure development. A direct air link would be game changer as both sides share the perception that such flights are vital for enhancement of bilateral ties, people to people contact, promotion of tourism and also business activities, thus both states are working over an alternative proposal linking Istanbul-Baku-Lahore.
Azerbaijan and Pakistan have agreed to expand bilateral cooperation in the fields of trade, gas and electricity besides introducing road and air connectivity. Pakistan-Azerbaijan Joint Commission (PAJC) must initiate meaningful dialogue for further strengthening of bilateral relations. Both sides decided to enhance business-to-business contacts through a Joint Business Council. They also agreed to facilitate talks and subsequent signing of MoU between the State Oil Company of Azerbaijan (SOCAR) and the Pakistan State Oil Company (PSO) and other nominated entities of Pakistan under the inter-governmental agreement (IGA) for trading crude oil, refined oil products, LNG and Liquefied Petroleum Gas (LPG) as well as joint development of new facilities for their import. SOCAR will exe cute activities through the SOCAR Trading S.A, which is SOCAR’s wholly-owned affiliate.
Azerbaijan has a huge demand for Pakistani agricultural products especially Basmati rice and fruits, including mango, dates and others. The two countries also have a potential of joint ventures in pharmaceutical and manufacturing of surgical goods which must be explored and jointly invested and financed.
Formation of Joint Ministerial Commission cultural forums like Pakistan-Azerbaijan Friendship Association, existence of Multani Caravanserai in lchiri Sheher Baku, reconstruction of the High School for Girls donated by the Heydar Aliyev Foundation of Azerbaijan in Azad Jammu and Kashmir and the adoption of resolution by Foreign Relations Committee of Senate of Pakistan recognizing Khojaly the massacre as genocide and demanding Armenia to leave Azerbaijan’s internationally recognized territory of Nagorno-Karabakh and its adjacent regions has already formed a strategic partnership between the two countries.
Military cooperation with Pakistan is increasing year by year. Pakistan actively participated in the recently concluded ADEX 2016 held in Baku. Officers of Azerbaijan have already participated in different training activities in educational facilities of Pakistan’s armed forces. Similarly, Pakistani officers participate in courses of the Azerbaijan War College.
The two countries signed a defense agreement in late January 2013 and naval officers subsequently held discussions on military technical issues. In addition, Azerbaijani naval personnel participated in a Pakistani-led exercise, Aman-2013, held in March on the Arabian Sea. Pakistan is also seen as a potential arms supplier to Baku. Over the past few years Azerbaijan has shown interest in obtaining JF-17 aircraft, a multipurpose combat jet developed jointly by Pakistan and China.
Azerbaijan has a liberal investment policy and Pakistani can invest there. Azerbaijan also has a strong industrial base and textile industry. Pakistan in turn has urged Azerbaijani investors to invest in oil and gas exploration sector in Pakistan and has also highlighted the the possibilities of trade in agriculture BI value-added products.
A new phase of development in Pakistan-Azerbaijan relations was seen after the recent visit of President Memnon Hussain, these ties will be further strengthened after the PM’s visit. Bonds between Pakistan and Azerbaijan are based upon historical, cultural and social affinities. Prospects of greater economic integration, speeding-up of FDls, joint ventures and cooperation in diverse fields) economy, industry, production, science and technology, ICT, education, etc.) are now becoming reality.
