New Delhi, Jan 5: India must remain engaged with Pakistan to the extent that the country develops a "vested" interest in the Indian economy which would then mean heavy economic costs for brazen militant attacks, Assocham said today.
"At times, the instrumentalities of economic costs work quite well. But since the commercial engagement between India and Pakistan have remained so low that there is no option for any such recourse," Assocham President Sunil Kanoria said.
India's total trade with Pakistan in fiscal 2014-15 was less than USD 2.5 billion with balance of trade loaded heavily in favour of New Delhi, the chamber pointed out.
Against exports of USD 1.85 billion, imports from Pakistan were less than USD half a billion, meaning thereby that "Pakistan does not depend on India, either for seeking markets for its exports, nor meeting its crucial requirements of imports. So, there is no possibility of any economic costs which can be inflicted on them in situations like this," Assocham said.
Kanoria said that while the basic principle of building commercial relations cannot be to inflict economic costs on the trading partner at a later stage, "a deep and well-entrenched commercial relation has dissuaded countries from taking extreme steps. To that extent, the economic ties have been used for strategic purposes as well."
While Sri Lanka, Bangladesh and Nepal remain the top commercial partners for India in South Asia, the total size of the engagement in the region is far less than the desired level, Assocham noted.
"Here too, a vast Indian market has not been really converted into a strategic resource for the partners in south Asia since India's total imports from South Asia are less than USD 3 billion, against exports of USD 20 billion," it said.
India needs to use its vast market for the South Asian partners as a "strategic resource" for them by giving them liberal access and even hand holding them, the chamber said.
The comments come against the backdrop of a terrorist attack at Pathankot air base that claimed lives of seven security personnels.
Political parties such as the Congress has slammed the government's handling of ties with Pakistan in the wake of the Pathankot terror attack which came within days of Prime Minister Narendra Modi's Lahore visit.