PAKISTAN-BULGARIA RELATIONS

 

Preface

1. Pakistan and Bulgaria have always enjoyed amicable ties defined by mutual respect and a convergence of views on global & regional developments. Diplomatic ties between the two countries were established on 15th June 1965. On the other hand, Bulgaria opened its Embassy in Islamabad in 1968. Sofia was concurrently accredited to our mission based in Belgrade and Bucharest from August 1965 to May 1971. The first resident envoy was Ambassador Mustafa Kamal who presented his letter of credence on 2nd July 1971. Likewise, Bulgaria’s first Ambassador was Prof. Ivan Nenov whose credentials came into effect in May 1970.

2. It then transpired that Pakistan’s Mission remained closed in Bulgaria from 1980 to 2009 while the Bulgarian diplomatic post continued to perform its duties. During this interregnum, the Mission in Bucharest had received concurrent accreditation of Bulgaria. Eventually, Pakistan reopened its Embassy in Sofia on 12th June 2009 and it has been functioning ever since.

3. Bilateral trade fails to reflect its true potential and was only recorded at an aggregate of US$ 34.2 million for the calendar year 2018. Pakistan’s exports were documented at US$ 20.8 million while imports from Bulgaria was calculated at US$ 13.4 million. A plethora of treaties have been concluded in many spheres of activity, but are more pronounced for the lack of substance and consistency when analyzed through empirical evidence.

4. Simultaneously being member of the EU, OSCE, NSG, IMF, Berlin Process, WTO and NATO, Bulgaria has assumed added significance in Pakistan’s foreign policy matrix. Its geo-political pedigree enables it to assume the mantle of a country bolstering the EU’s external borders. This is at the coordinates where West & East Europe as well as Asia Minor overlap, a portmanteau of sorts. Expanding further, in terms of distance by land, Bulgaria is the nearest EU member to Pakistan. A road trip through Iran and Turkey would entail a time duration of 45-55 hours if examined on Google Maps; in the real world, perhaps 7-10 days.

VVIP/VIP Interaction

5. Despite the existence of cordial diplomatic relations spanning more than five decades, the visit by a Head of State or Head of Government from Pakistan is still to materialize. Neither has there been a reciprocal bilateral visit at the Ministerial level that has emanated from our side. In January 2011, then Bulgarian Foreign Minister, Nikolay Mladenov, had visited Pakistan It was then that the Agreement on Economic Cooperation was signed on 19th January 2011 with Minister of State for Finance & Economic Affairs, Hina Rabbani Khar. This was the last interaction of real substance at the VVIP/VIP grade.

6. The Pakistani and Bulgarian Foreign Ministers, though, have met on the sidelines of major international fora. A mere handful of official level delegations from both countries have participated at respective defence and business-oriented exhibitions/forums. Minister of State for Foreign Affairs, Makhdoom Khusro Bakhtyar, visited Bulgaria in July 2006 as part of his 2-nation tour that also included Romania.

Parliamentary Friendship Group

7. A Pakistan-Bulgaria Parliamentary Friendship Group was established in our National Assembly in 2010. The corresponding Parliamentary Friendship Group in Bulgaria’s unicameral Narodno Subranie or National Assembly had already been created in 2009 and consists of 7 members. A tour by our parliamentary friendship group occurred from November 12-15, 2019.

Mutual Candidature Support

8. Bulgaria and Pakistan have always backed each other’s candidatures at different international fora over the years. In recent times, these have been defined by:

Bulgaria
• Mutual backing of Pakistan’s candidature at attaining membership of the International Telecommunication Union (ITU) that covers Region E and encompasses the term 2019-22.
• Pakistan’s candidature for the Human Rights Council coinciding with the tenure of 2021-2023. We had lent our support to the successful campaign of Ms. Genoveva Tisheva as member of the UN Committee on the Elimination of All Forms of Discrimination Against Women (CEDAW) for the period 2019-2022.

Pakistan
• Reciprocal support of Bulgaria’s candidature at attaining membership of the International Telecommunication Union (ITU) that covers Region C and corresponds with the term 2019-22.
• Bulgaria’s aspirant to the Human Rights Council (HRC) coinciding with the period 2019-2021.
• Pakistan backed Ms. Irina Bokova during her successful re-election as Director General UNESCO in October 2013. On 6th February 2014, President Mamnoon Hussain was pleased to confer Hilal-i-Pakistan on Ms. Bokova.

Bilateral Political Consultations (BPC)

9. The Protocol on Bilateral Political Consultations between the respective Ministries of Foreign Affairs of Bulgaria & Pakistan came to fruition in November 1994 in Islamabad. Thus, the inaugural session of the BPC materialized in Sofia on 7th April 2008. The 2nd BPC chapter was organized in Islamabad on 31st March 2016 after a hiatus of eight years. The 3rd BPC session was organized in Sofia on 7th December 2017. The most recent interaction was at the 4th BPC that was conducted in Islamabad on 5th November 2019. The whole gamut of bilateral ties was deliberated upon from the political, cultural, defence, economic & trade spheres.

Science & Technology

10. In November 2016, a Memorandum of Cooperation (MoC) between the respective Academy of Sciences was inked. It is hoped that this mechanism would serve as a conduit for propagating collaboration in this prominent sphere because it retains limitless prospects.

Education

11. Great interest was evinced at the opening Inter-Governmental Commission (IGC) session of 2015 by the Higher Education Commission (HEC). Thus, formal associations have been created with Bulgarian educational institutions for joint research, student exchange and sharing of information with an academic interest. This has brought forth linkages between Government College University Lahore and Sofia University St. Kliment Ohridski; Trakia University Stara Zagora and University of Veterinary & Animal Sciences, Lahore; National University of Sciences and Technology (NUST) and South-West University Neofit Rilski, Sofia; Agriculture University of Plovdiv and University of Agriculture Faisalabad; University of Finance, Business and Entrepreneurship (VUZF) Sofia and Kinnaird College for Women, Lahore; and, VUZF and University Management and Technology (UMT) Lahore.

Pakistani Diaspora

12. The Pakistani community residing here is minimal, estimated at hardly 80 individuals. These include individuals who have intermarried in Bulgaria or are engaged in white collar professions, especially in the IT sector. One runs a handicraft store. About two dozen Pakistani students are also enrolled in medical, technical and engineering programs across several Bulgarian universities. On the other hand, a mere handful of Bulgarians are dwelling in Pakistan.

Kashmir Dispute

13. Bulgaria has adopted an impartial stance as far as the Kashmir dispute is concerned. Its official policy of neutrality in this aspect has been conveyed in vivid terms wherein India and Pakistan are expected to negotiate a peaceful settlement.

Pakistan Technical Assistance Programme (PTAP)

14. This facility was offered to Bulgaria in June 2019 in the aftermath of the 2nd Inter-Governmental Commission (IGC). At the outset, Bulgarian nominations were invited for short duration training courses in banking, postal services and railways. At the outset, a nominee of BULGARIA POST attended a month-long program organized by the ECO Postal Staff College Lahore in October 2019.

ECONOMIC PEDIGREE

Global Economic Indices

15. An annual review by the Bulgarian Chamber of Commerce and Industry (BCCI) concluded that in 2018, Bulgaria held stable ground in terms of economic freedom, prosperity and competitiveness. In 2019, Bulgaria was placed at 37th place out of 172 countries in the Index of Economic Freedom of The Heritage Foundation and The Wall Street Journal, and moving up one spot to 39th out of 162 countries in the Fraser Institute’s Economic Freedom of the World Index. On the other hand, Bulgaria has been positioned at 61 out of 190 economies in the World Bank’s Ease Of Doing Business 2020, while Forbes’ annual review of the Best Countries for Business 2018 depicted Bulgaria at number 46.

GDP Growth

16. Despite being labelled as the poorest EU member and citing global financial turbulences in 2016, the Bulgarian economy has been manifesting its resilience. Aggregate GDP in 2018 was US$ 65.13 billion. The GDP growth rate hovered between 3.3% and 3.6% in 2019. Per capita income at GDP rates is US$ 8000. Inflation is documented at 2.8%, unemployment is a tad over 4%, whereas the average wage is € 600. Minimum wage has been augmented since the last 4 years and has now attained € 320. This is a far cry from when the country was beset by the hyperinflation crisis of 1996-1997. It was then the Bulgarian leva (BGN) was permanently pegged to the Euro (€).

Employment Profile

17. The aggregate level of employment for 2019 was recorded at almost 70%. The chief labour demand, according to the analysis of the Employment Agency, has been observed in the following economic activities: processing industry – 30%, government – 14%, trade – 13%, administrative & auxiliary activities – 7%, hotels and restaurants – 5%. Another conclusion drawn is that the most sought-after professions are: child care & health care personnel; machine operators; store vendors; skilled workers in food production, clothing, woodwork and related products; mining, manufacturing, construction, transport, personnel employed in the field of personal services, etc.

Bilateral Trade Interface

18. Despite over half a century of amenable relations, bilateral commerce remains mundane. There was a time when during the Socialist era, two-way trade between Pakistan and Bulgaria was depicting a maximum of US$ 160 million in 1988. The trade in that phase was regulated by intergovernmental barter protocols. Barter protocols with Bulgaria were last extended until 1996. Ultimately, both parties waived this mechanism as a consequence of Pakistan (1995) and Bulgaria (1996) joining the World Trade Organization (WTO).

19. Pakistan’s exports are primarily in woven cotton, synthetic staple fibers, bed/table linen, polyesters, polyacetals and surgical instruments. Expanding further, over two-thirds of the export base to Bulgaria is premised upon textiles. On the other hand, imports from Bulgaria are in vehicle components, liquid pumps, legumes, raw tobacco, used clothing, refined copper, carbonates, machinery such as electric accumulators & separators and animal feed. In recent times, trade relations have amplified and this has been witnessed especially since 2010.

20. Nevertheless, there still exists substantial room for improvement. The chart below reinforces the concept of realizing the potential of bilateral trade that can take on added value:

US$ Million

Year Exports Imports Aggregate
2012 14.7 15.8 30.5
2013 14.0 25.4 39.4
2014 20.5 14.7 35.2
2015 16.2 13.8 30.0
2016 15.8 13.9 29.7
2017 21.1 15.9 37.0
2018 20.8 13.4 34.2

 

21. At the 3rd Bilateral Political Consultations (BPC) session held in December 2017 in Sofia, the necessity for enhancing bilateral trade was emphasized through the exchange of trade delegations and by the stress laid on launching warehouse facilities/trade incubator hubs in both countries.

Trade Incubators

22. A warehouse or trade incubator in Bulgaria would be ideal in sampling, marketing and distribution purposes for Pakistani exports to potential new markets within Europe. The incubator would be adequately placed to oversee the growth of Pakistani start-ups or early-stage firms. To intensify penetration and enhance the outreach of our export goods, the warehousing centre (bonded or otherwise) would be conducive in reaching the eastern European region as well as new markets in Western Europe (200-400 million people). Our ambivalence in the quest for emerging markets has resulted in stunted exports

23. A crucial aspect is that Bulgaria is the closest EU member to Pakistan by land proximity. Therefore, a container truck packed with commodities could exit the Taftan border check post, and traverse Iran & Turkey before entering Bulgaria at the Kapitan Andreevo border point or vice versa in about 6 days.

24. Delineating further, Bulgaria’s National Company Industrial Zone (NCIZ) is operating 7 functional industrial & free zones all over the country. The municipalities have also created their own industrial space. The goods that reach Bulgaria could be stockpiled at any one of these corporate parks for onward reexport to destinations in Western Europe or the Black Sea rim. In this way, we will simultaneously reap greater benefits through GSP+.

25. Summarizing further, a broad outline of the factors that make the establishment of such a commercial hub in Bulgaria feasible are:

i. Bulgaria is the nearest overland EU member to Pakistan.
ii. A warehousing facility in Bulgaria would facilitate potential European buyers in making a short journey to Sofia for the inspection of samples, negotiate terms and place orders.
iii. Bulgaria has established itself within the EU as possessing one of the lowest rates of import tariffs, uniform corporate tax and low dividend tax.
iv. The country prides itself on an educated, digitalized, youthful pool of manpower available at the most competitive wages in Europe.
v. Bulgaria is endowed with low rates of utility payments, especially electricity charges. Power outages are very unusual.
vi. Warehousing facilities and office space in Bulgaria are available at lower than average costs when compared with other parts of Europe.

Inter-Governmental Commission (IGC)

26. The Inter-Governmental Commission (IGC) on Economic Cooperation was established on 19th January 2011. From June 22-23, 2015, the opening session of the IGC was organized in Sofia that was ultimately followed by the 2nd IGC on 21st May 2019 in Islamabad. It was then that the Agreement on the Avoidance of Double Taxation and Prevention of Fiscal Evasion With Regard to Taxes on Income was inked.

Trade Delegations & Exhibitions

27. Reciprocal trade delegations are ardently needed in both ways. A TDAP delegation of pharmaceutical manufacturers toured Sofia from May 8–14, 2007. In July 2010, an entourage from the Gujrat Chamber of Commerce visited. Likewise, in May 2017, a 4-member business delegation of the Jhang Chamber of Commerce came to Bulgaria. Upon closer scrutiny, a Bulgarian delegation has yet to participate in any edition of EXPO or TEXPO PAKISTAN thus far.

28. On the other hand, Pakistani entrepreneurs have sporadically appeared at major trade fairs in Bulgaria in recent times, including the premier Plovdiv International Fair. Bulgarian entrepreneurs have been visiting Pakistan in their individual capacity after being accorded invites by Pakistani corporate associates.

GSP+ Status

29. In December 2013 when the motion for according GSP+ status to Pakistan was put to a vote, 16 out of 17 Bulgarian Members of European Parliament (MEPs) supported the move. Bulgaria has always assured of proffering support to Pakistan for retaining the GSP+ status and have confirmed their backing to positively review Pakistan’s GSP+ facility.

Agriculture & Food Processing

30. Much potential exists in terms of agro-food trade. Pakistani mangoes and kinnows have been promoted here in Bulgaria for the last three seasons. For the first time in June 2019, mangoes entered the Bulgarian market in a commercial capacity, a maiden for the Balkans. Kinnows debuted in Bulgaria in 2018, also another first for the entire EU bloc in a decade. Similarly, apart from wheat, the commodities that could be inserted into the local supply are chick peas, lentils and vegetables. Bulgarian yoghurt is prominent the world over. Its technology could be implanted in Pakistan. Another product is lyutenitsa – a concoction of peppers, aubergines, carrots, garlic and tomatoes.

31. Keeping in perspective the Prime Minister’s Agriculture Emergency Program emphasizing (i) Productivity Enhancement of Wheat, Rice & Sugarcane (ii) Oilseeds Enhancement Program (iii) Conserving Water Through Lining of Watercourses (iv) Enhancing Command Area of Small and Mini Dams in Barani Areas (v) Water Conservation in Barani areas of Khyber Pakhtunkhwa (vi) Shrimp Farming (vii) Cage Fish Culture (viii) Trout Farming in Northern Areas of Pakistan (ix) Fattening of Calf Program (x) Backyard Poultry Program; several of these concepts could be adapted in terms of collaboration with Bulgaria.

32. Of specific interest is the sharing of technical expertise and importing Bulgarian sunflower seeds/extract, rose oil/fragrance and lavender oil. Bulgaria is designated as the world’s foremost producer of lavender and its products.

33. The Agriculture Academy of Bulgaria (AAB) and the Pakistan Agricultural Research Council (PARC) have concurred to signing an MoU on agriculture research and genetic engineering, which is slated for the opening quarter of 2020.

34. The Embassy organized the inaugural Agro-Food Conference in Bulgaria’s breadbasket of Dobrich in October 2019. This event, among other things, underscored the latent potential ubiquitous with agriculture and its dimensions for both nations.

DEFENCE & SECURITY PARADIGM

Bilateral Collaboration

35. There has pervaded limited defence interaction between the two countries. The outcome is restricted to a mere handful of security events. Pakistan Navy’s Tall Ship “Rahnaward”, which made harbour at Bulgaria’s coastal city of Varna as part of the Black Sea Regatta in May 2014, was one of the highlights when our defence paths converged.

MoU On Defence Cooperation

36. The Bulgarian side had proposed the draft text of the MoU on Defence Cooperation in 2011. However, concurrence to the text of the MoU occurred only at the end of 2015 when our Ministry of Defence conveyed its ‘No Objection’ to the draft initiated by Bulgaria. Eventually, the Bulgarian Defence Ministry has explicated that enhanced consultations are still required at the expert-level. Minutiae of commencing discussions in the format of a strategic engagement dialogue are being evaluated.

Training Programs

37. Since the last decade, Pakistan has been offering one trainee seat to Bulgaria at the Command & Staff College, Quetta. This is associated with other programs that run concurrently in other military installations. Another two gratis trainee seats were extended to Bulgarian naval cadets on board Tall Ship “Rahnaward” in June 2015.

38. Moreover, under the aegis of training, programs can be supervised in simulation systems and gathering intel. The regimen is also magnified to include nuclear policy doctrine, grey hybrid warfare, arms control and disarmament. Much advantage persists in an interface between respective naval institutions.

IDEAS & HEMUS Defence Exhibitions

39. A two-member Bulgarian delegation, led by the Permanent Undersecretary of the Bulgarian Defence Ministry, participated at the 8th IDEAS 2014 exhibition in Karachi. Similarly, an entourage representing Pakistan’s defence ministry partook at Bulgaria’s premier defence event called HEMUS in 2014 & 2016. On the other hand, invites from Pakistan’s Ministers of Defence & Defence Production respectively as well the Chief of Air Staff have also been extended to their Bulgarian counterparts.

40. It may be comprehended that Pakistani defence paraphernalia are recognized for its prowess in small arms, combat gear, military technologies, battle tanks & APCs, munitions and the premier JF-17 Thunder. Apart from the state defence apparatus, continuous efforts have been expended in liaising with the indigenous defence production industry.