Pak-Iran Economic Rejuvenation

Rooted in historical linkages, religious ties, shared language, cultural affinities, and spiritual connections, the bilateral relationship between these two nations has long been characterized by cordiality and reciprocal admiration.

Despite the presence of shared religious, cultural, and historical bonds, their association has faced hurdles due to various factors, including security concerns, divergent economic interests, and contrasting regional alignments. A noteworthy aspect of Iran-Pakistani relations is the occurrence of cross-border incursions by Pakistani militants, which have added to the tumultuous nature of their interaction.

In a remarkable turn of events, the current landscape is witnessing a resurgence of enthusiasm and a growing inclination toward collaboration between Pakistan and Iran. An outstanding development unfolded recently when Pakistani PM Shehbaz Sharif and the Iranian President, Seyed Ebrahim Raisi, jointly inaugurated the Mand-Pishin border market. This strategic initiative holds great significance as it aims to bolster the prospects of bilateral trade. Located in the remote village of Pashin, nestled within Pakistan's southwestern province of Baluchistan, this pioneering marketplace serves as the inaugural venture among a planned series of six installations along the Pakistan-Iran border. The establishment of these marketplaces is guided by the provisions outlined in a bilateral agreement inked by both nations back in 2012.

With Pakistan grappling with energy scarcity, it has turned to costly imports of refined and crude oil, totaling $6.462 billion in 2020, and expensive LNG, amounting to $3.4 billion in 2021, predominantly from Qatar. Yet, Pakistan possesses a huge potential to import more affordable gas from Iran, thereby diminishing its dependence on costly LNG from Qatar. Key to seizing this opportunity is the prioritization of the construction of the IP gas pipeline.

Following the inauguration of the Mand-Pishin border market, the leadership of both sides has emphasized key sectors such as trade, investment, information technology, agriculture, and others, both sides resolved to advance cooperation, fostering mutually beneficial outcomes. In addition, the two leaders mutually agreed to explore the potential for collaboration in power transmission and further strengthen their cooperation in the solar energy sector. Pakistani Prime Minister Shehbaz Sharif also presented suggestions concerning the China-Pakistan Economic Corridor (CPEC), emphasizing the concerted efforts to implement the decisions made during the meeting.

The Mand-Pishin border market holds great potential to significantly boost trade activities in the surrounding regions with the construction of trade centers in the area. Notably, the joint inauguration of the trans-border Polan-Gabd electricity transmission line will also play a vital role in providing electricity to businesses and households. Specifically, it will facilitate the import of an additional 100 MW of electricity from Iran, a key step toward meeting the growing energy demands of the area.

In a nutshell, the Mand-Pishin border market will emerge as a dynamic center, catalyzing economic growth by fostering the expansion of trans-border trade, and engendering new opportunities for local enterprises between Iran and Pakistan. This joint inauguration exemplifies the resolute dedication of Iran and Pakistan to enhance the well-being of populations inhabited in the contiguous provinces of Sistan-o-Baluchestan in Iran and Balochistan in Pakistan, heralding a new era of collaboration and mutual progress.