“It’s obvious there was opposition from some ministers such as Shah Mahmood Qureshi,” India’s ex-envoy in Islamabad said

When Pakistan’s new finance minister Hammad Azhar announced a move to partially restore trade ties with India on Wednesday, it was seen in the context of a gradual thaw in bilateral ties spurred by the two sides again adhering to the 2003 truce on the Line of Control (LoC).

But the backlash on the other side of the border was swift – within hours, with many, including human rights minister Shireen Mazari, saying the decision by the Economic Coordination Committee (ECC) of the Cabinet didn’t have the endorsement of the whole Cabinet, and sections of the electronic media were up in arms about a concession made by Islamabad without any reciprocal measure from the Indian side.

What should have been a simple endorsement of the ECC’s decision at a Cabinet meeting on Thursday instead turned into a larger debate on the need to review bilateral ties with India, especially the changes made by New Delhi in Jammu and Kashmir’s special status in August 2019. According to the buzz in Islamabad, much of this debate was spurred by hawkish elements in the Imran Khan government, including interior minister Sheikh Rashid Ahmed and foreign minister Shah Mahmood Qureshi.

By the time the dust had settled, a new message had emerged from Islamabad following a second meeting chaired by Prime Minister Imran Khan on Friday to review relations with India – there can be no bilateral trade relations or normalising of ties till India reviews its 2019 decision on Jammu and Kashmir.

Insiders say this new messaging reflects divisions within the Imran Khan government on the behind-the-scenes contacts between India and Pakistan that led to the revival of the 2003 ceasefire on the LoC on February 25. These contacts, the insiders say, are being driven on the Pakistani side by army chief Gen Qamar Bajwa and Moeed Yusuf, the special adviser to the prime minister on national security.

According to the insiders, even Qureshi wasn’t in the loop on the contacts that led to the ceasefire announcement in February and this was reflected in his hawkish speech at the Islamabad Security Dialogue last month. In marked contrast, Bajwa spoke at the same event about the need to “bury the past and move forward”, while Khan talked about India taking the first step to improve bilateral ties by addressing Kashmir, the only issue standing in the way of better relations.

It has also emerged that the ECC cleared the issue of importing cotton and sugar from India because the formal proposal came from the commerce ministry, which is headed by the prime minister. However, Khan as the prime minister shot down the same proposal when it was discussed by the Cabinet the next day.

Mehmal Sarfraz, a Lahore-based journalist who closely tracks India-Pakistan relations, attributed the imbroglio to the Imran Khan government moving too quickly on the issue of trade with India.

“I think the government announced the decision too soon. Also, it shouldn’t really seem to be unilateral concessions from the Pakistani side when the Indian side has not yet taken any reciprocal steps,” Sarfraz said.

Pakistan unilaterally suspended trade ties with India in August 2019 as part of a package of measures aimed at retaliating against the change in Jammu and Kashmir’s special status. The measures included a decision not to post a new high commissioner in New Delhi and to expel the Indian envoy in Islamabad.

Baqir Sajjad Syed, an Islamabad-based journalist with Dawn newspaper, described the Pakistan government’s decision as “curious”. Syed noted that Abdul Razak Dawood, adviser to the prime minister on commerce and investment, tweeted that Khan allowed cotton imports to “ease pressure on yarn”, he said the move to resume trade with India “was public knowledge days before it happened, and it wasn’t that someone was caught by surprise”.

“The only explanation that comes to mind is that there was an adverse reaction in some segments of the media, and secondly, some hawkish elements within the Cabinet prevailed on the prime minister to defer the ratification of [trade ties with India]. Remember, it has not been rejected,” Syed said.

Insiders agreed with this view, saying Khan and Bajwa needed more time to build public opinion in favour of better ties with India while addressing the objections of more hawkish elements.

For old Pakistan hands on the Indian side, the flip-flop on trade wasn’t entirely new.

“I remember when I was the Indian deputy high commissioner in 1997, a team from the PHD Chamber of Commerce and Industry came to Pakistan and signed an agreement with the Lahore Chamber of Commerce and Industry. The very next day, the Lahore chamber issued a statement that there couldn’t be any trade with India till the Kashmir issue is resolved,” said Sharat Sabharwal, who served as India’s envoy in Islamabad during 2009-13.

Sabharwal said the posting of high commissioners in both capitals, easing of travel restrictions and resuming trade were the obvious ways to build on the LoC ceasefire announcement.

“It’s obvious there was opposition from some ministers in Imran Khan’s Cabinet, such as Shah Mahmood Qureshi, Asad Umar, Sheikh Rashid Ahmed and Shireen Mazari. Some in the Pakistan Army are also uncomfortable about the move,” he said.

“The second factor is lobbies with strong commercial interest, which sometimes cloak their demands in the garb of issues such as Kashmir. There is a very strong sugar lobby in Pakistan and some producers would stand to lose if prices were to fall [because of cheaper imports from India],” Sabharwal said.

Experts now believe the hardline position taken by Pakistan, by linking the normalisation of bilateral relations to the Kashmir issue and the changes in Jammu and Kashmir, could complicate the nascent moves to improve ties.

“The Modi government certainly can’t do any review of its decisions on Kashmir,” Sabharwal said.