As Karl Marx opined, economics shapes human history – past, present, and future. It influences all aspects of life, especially politics. Globalisation has reinforced it, with countries competing to form economic alliances and developmental projects like BRICS and the Belt and Road Initiative (BRI). Over the last two years, Pakistan has shifted its focus to geoeconomics, leveraging its strategic geography. Lately, most of the national news and the indigenous literature has covered the China-Pakistan Economic Corridor (CPEC) as a game changer for Pakistan’s regional cooperation and economic portfolio, which is true in terms of its scope and investment. In all this, other economic alliances failed to attain a reasonable place in the national discourse. One such example is the Economic Cooperation Organisation (ECO).
ECO was founded in 1964 by Turkey, Iran, and Pakistan as Regional Cooperation for Development (RCD) to promote regional economic cooperation. It was renamed to ECO in 1985. It has advocated for effective multilateralism at the regional level and held out the prospect of regional economic integration at a time when the world was unaware of BRI and BRICS. The plan was to use the three nations’ shared history of kinship and fraternity to create a transparent international platform.
Pakistan and ECO
ECO’s primary forte lies in its emphasis on economic matters and fostering connectivity. The organisation strives to tailor its efforts to meet the unique requirements of its member states, aiming to establish an environment conducive to trade enhancement and economic betterment. As one of the founding members, Pakistan holds a profound dedication to actualising ECO’s objectives. Pakistan hosted the 13th ECO Summit in Islamabad in March 2017. The summit, themed “Connectivity for Regional Prosperity,” resulted in the adoption of two critical ECO documents: “Islamabad Declaration” and “ECO Vision 2025”. These documents outline the organisation’s agenda until 2025 and serve as tools to assess progress.
Interim Prime Minister of Pakistan, Anwar-ul-Haq Kakar, while addressing the 16th Summit of ECO in Tashkent, emphasised Pakistan’s unwavering dedication to the ECO’s agenda for regional growth and development.
At the beginning of November 2023, Interim Prime Minister of Pakistan, Anwar-ul-Haq Kakar, while addressing the 16th Summit of ECO in Tashkent, emphasised Pakistan’s unwavering dedication to the ECO’s agenda for regional growth and development. He highlighted the crucial role of promoting regional growth, trade, investment, connectivity, and sustainable economic development among member states, aligning with the ECO Vision 2025. This could be expanded not only by promoting the corridor-based concept but also by engaging in the networking of different economic corridors into each other, like CPEC and ECO networks. Such networks are connected through the proposed initiatives like Mainline or the ML-1 railway project. Under CPEC, initiatives like the Islamabad-Tehran-Istanbul Rail and Road Corridor would bring greater regional advantages.
Table 1: Demographics of ECO region
Compiled by the Author
Table 2: Intra-regional trade and ECO, Pakistan’s trade within ECO
Compiled by the Author
The present status of intra-regional trade within the ECO and Pakistan’s trade specifically are highlighted by these statistics in Table 2. The statistics underscore the significant disparity between the current trade volumes and the potential for increased intra-regional trade given the region’s resources and global population share, as shown in Table 1.
Discussion
ECO stands as a beacon of promise for regional economic collaboration among its member states. At its inception in 1985, ECO envisioned a cooperative framework nurturing economic growth, trade, and connectivity among its ten member states across Central Asia, West Asia, and South Asia. However, despite concerted efforts and commendable initiatives, the organisation has not fully realised its potential, especially in the realm of economic integration. Pakistan, a pivotal player in the region, views ECO as a crucial avenue for expanding trade, connectivity, and economic partnerships. Yet, several factors impede the realisation of these aspirations.
Firstly, the current volume of intra-regional trade within ECO remains significantly below its potential. Despite possessing abundant resources and a sizable collective population, intra-regional trade stands at a mere fraction of the total external trade, as shown in Tables 1 and 2. From Pakistan’s standpoint, this underlines the need for a renewed focus on trade facilitation, tariff reduction, and the removal of non-tariff barriers among member states. Secondly, while the ECO endorsed pivotal agreements like the ECO-Trade Agreement (ECOTA), their full implementation faces hurdles. Ratification by several member states does not necessarily translate into effective execution, leading to unrealised benefits. Pakistan advocates for a collaborative effort towards the effective implementation of existing agreements while considering revisions that align with contemporary economic dynamics. Thirdly, enhanced connectivity remains a cornerstone for economic integration within ECO. Physical infrastructure development, particularly in transport and energy, holds the key to promoting stronger economic ties. Pakistan emphasises the need for collaborative projects aimed at improving road, rail, and energy networks across the region.
Furthermore, aligning ECO’s economic integration strategies with Pakistan’s national economic agenda and CPEC is crucial. It involves synergising regional objectives with domestic priorities to maximise mutual benefits. This alignment could improve industrial cooperation, technological exchange, and investment opportunities. Pakistan envisages a reinvigorated ECO that catalyses economic growth and integration among member states. Through rigorous efforts in trade facilitation, agreement implementation, infrastructure development, alignment with national agendas, and institutional strengthening, ECO can transform into a formidable economic force, benefiting not only Pakistan but the entire region.
