Pakistan-India Trade: An Analysis of the Health Sector

This study explores Pakistan-India trade in commodities and services within the health sector. We investigate existing trading patterns (by calculating a trade intensity index) along with the potential for trade between Pakistan and India (through a trade complementarity index) in three commodities: medical equipment, pharmaceutical products, and surgical instruments. Using import-export data, we found that between 2003 and 2011, Pak-India trade intensity (in relation to Pakistan’s total trade) was extremely low. Once we identified the drivers of trade in the three commodities, we found that Pakistan imports from the world commodities that are India’s leading exports to the world, with the converse holding true for Pakistan, at least for surgical and pharmaceutical goods. There is, thus, high potential for trade in the three commodities, especially at the intra-industry level. Gains would be much higher if trade in these sectors was liberalized on the Pakistani side by removing key Indian exports from Pakistan’s negative list and if Pakistani exports were allowed easier access to the Indian market. This chapter also examines trade in health services, particularly research and collaboration in medicine and pharmaceuticals, movement of medical personnel and patients, and student exchange or training programs. Our qualitative analysis indicates that there is evidence of medical tourism particularly from Pakistan to India, but this is largely driven by individual efforts. There is no bilateral institutional mechanism through which collaborative research in medicine and pharmaceuticals can be undertaken.