Abstract

Cross-border trade is crucial in fostering the economy, significantly contributing to the country’s economic growth, and providing an avenue for the local population residing on both sides of the borders. Pakistan and Iran share a 900 km long border called the “Gold Smith Line.” The residents of both sides are Baloch ethnicity, which share the same culture and a homogenous society. Despite these similarities and historically friendly relations, the trade between these two countries is relatively low. This study aimed to determine the reasons for low trade between Pakistan and Iran by adopting qualitative data collection technique. A survey of traders and stakeholders was done along with personal visits and interviews. The study explored the socio-economic impacts of cross-border trade on the local population as their only source of earning is border trade-related businesses. It also examined the adaptation of international trade standards, mainly at the Tatan Border. For this reason, and due to the lack of prior research, this exploratory case study design has been used to explore the prospects and reasons for low trade between Pakistan and Iran and determine the socio-economic impacts of trade on the local population of Districts “Chaghi” and District “Washuk”. Findings indicate numerous reasons for the low trade between these two countries. US sanctions, Infrastructure inefficiency and operational deficiencies are main contributing factors to trade slow down. Results reveal that few international standards are being followed and need upgradation. Crossborder trade is the only source of livelihood and employment in the bordering areas of Pakistani province (Balochistan) and Irani (Sistan-o-Balochistan) which instigated different trade routes. The study recommends overcoming infrastructure inefficiency and operational deficiencies providing cold storage and warehouses, resolving telecommunication issues, speed money and hectic clearance procedures to fasten the trade. Most importantly, encouraging the involvement of local communities in trade processes and maintaining their employability is recommended.