May 24th, 2012
01:46 PM GMT
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India and Pakistan’s border in Kashmir is one of the most dangerous in the world. But the "Line of Control" dividing them has been opened to trade, in the hope that it can boost the local economy and help build peace between the two nations.

Kashmir has been a major flashpoint for India and Pakistan since the countries were partitioned at the end of British rule in 1947. Both say Kashmir belongs to them.

There's still a heavy security presence throughout the area, but the situation is much better than it was a few years ago, say local residents. And the relative calm is bolstering trade.

Four days a week, trucks loaded with fruits, spices and other goods cross one of the most militarized frontiers in the world - the Line of Control  - a de facto border that divides Kashmir.

Pakistani trucks cross the frontier carrying fruits and vegetables for the local Indian market. After a short drive in Indian-controlled territory, the Pakistani trucks offload their goods to Indian ones. But not a single rupee is exchanged. Instead, they use a unique barter system, a truck-load of potatoes traded for a truck-load of bananas, for example.

The barter system was introduced by the governments of India and Pakistan in 2008. It marked the first direct trade link between the two sides of Kashmir in more than 60 years. Officials called it a confidence-building measure, and the results are promising. As tensions have eased, commerce has grown, with cross-border trade now valued at around $120 million a year.

But traders want to see more done to facilitate commerce. “We don't have banking here, we don't have telecommunication here,” Indian trader Mohamad Shafi Bhat told CNN’s Mallika Kapur. “We cannot see each other, we cannot visit each other.”

He said that doing business across the line of control with someone he has never met requires a lot of trust, adding that cross-border trade can help build trust between India and Pakistan.

Mubin Shah, of the Jammu and Kashmir Joint Chamber of Commerce and Industry, believes that with more trust and more trade reforms, Jammu and Kashmir could become a major trading hub for Central Asia.

“Jammu and Kashmir can take advantage of its geographical position, for the first time,” said Shah.

He added: “All the previous years, it has been disadvantaged, because we are on one side China, another side India, another side Pakistan, then there is Afghanistan. But, if trade is done, and Jammu and Kashmir is declared as a free economic zone, it will completely change the politics of the state, politics of the country, both the countries, India and Pakistan.”

soundoff (7 Responses)
  1. Krishna

    Glad to see it. Pakistan's our neighbour, and although there's hostility on both sides, there's an indisputable similarities hidden through the ashes. To be specific, we share the same culture, food, movies, etc. Furthermore, when I say I'm proud to be Indian, I'm not only proud of my country, but I'm also proud of my language, culture, people, etc. and am ready to preserve and defend it. In this, for the most part, Pakistanis are also my people considering how I share more in common with them compared to South America, Europe, Middle East, etc. In reality, there isn't supposed to be 2 nations. This theory, propelled by Jinnah, assumes that Hindus & Muslims cannot coexist in a productive society. I'm, above all, proud to be a Hindu, but I will say this mentality is false. For example, look at at Hyderabad, Bengal, Dehli, Punjab, etc. Hindus and Muslims coexist without friction.However, in present times, the friction arises from the issue of Kashmir and the rise of terrorism. I take India's side in this and will stick with my country forever. However, I'm open to the possibility of peace between the 2 powers, and I can argue most people are, as well. This, of course, is a vision Gandhi had and is necessary for the future of both nations if they plan to succeed.

    May 25, 2012 at 1:48 am |
  2. faisal rehman

    Great to know that tensions have eased

    May 25, 2012 at 6:04 am |
  3. faisal rehman

    if america will stay out and stop taking sided than issues in this part of the world will be resolved

    May 25, 2012 at 6:05 am |
  4. Sareer A. Fazili

    This article is good and fine for Indians and Pakistanis, but it means nothing for the people of Kashmir. Their land is illegally occupied by both countries, Kashmir is split and divided forcibly, and despite UN Resolutions calling for Kashmiris being allowed to exercise their right to self determination, they are ignored. And even here, Indian and Pakistani governments are regulating what goods can cross the border, and for what renumeration. They aren't even allowed to exchange money. And this is being trumpeted as something good? Trade and "Confidence Building Measures" between India and Pakistan do not equate to respect for Kashmiri sovereignty or the people of Kashmir. This is continued encroachment on Kashmiri sovereignty. Finally – it is NOT a LINE OF CONTROL. It is a CEASE FIRE LINE. Please make note of the proper term.

    May 25, 2012 at 6:10 am |
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