Pakistan-India Trade : An Analysis of the Health Sector

This study explores Pak-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. We find that between 2003 and 2011, Pak-India trade intensity (as measured in relation to Pakistan’s total trade) was extremely low. At the same time there is high potential for trade in all three commodities, especially at the intra-industry level. Furthermore, upon identification of the drivers of trade in each of the three commodities, Pakistan’s top imports from the world feature commodities that are leading exports of India to the world. This is equally true for Pakistan for the surgical and pharmaceutical sectors. Gains would be much higher if trade in these sectors were liberalized on both sides, by removal of key Indian exports from Pakistan’s negative list and easier access for Pakistani exports in the Indian market. Our paper also examines if there is any evidence of trading in health services, particularly, research and collaborative work in medicine and pharmaceuticals, documented movement of medical personnel and patients at the institutional level, and student exchange or training programs. On average, our qualitative analysis indicates that there is evidence of medical tourism, particularly of Pakistani patients travelling to India on an individual basis. But there is no institutional bilateral mechanism though which collaborative research can be undertaken