In what may be construed as small but significant gains, commerce secretaries of Pakistan and India on Tuesday, fleshed out a sequential plan towards liberalisation of trade between the neighbouring countries.
A joint statement issued by Commerce Secretary Zafar Mahmood and his Indian counterpart Rahul Khullar, at the conclusion of the two-day talks between them in New Delhi, set a timeline for the operationalisation of Most Favoured Nation (MFN) status for India and the obliteration of trading lists, positive or negative.
The joint statement came as Indian Defence Minister AK Anthony warned not to expect too much from the ongoing dialogue.
Path to free trade
Currently, Pakistan maintains a ‘positive’ list, comprising about 2,000 items that it trades with India. In the first stage, according to the statement, Pakistan will switch to a ‘negative’ list approach, with the list finalised and ratified by February 2012. Thereafter, the countries will be able to freely trade all items other than those on the negative list.
In the second stage, the negative list shall be phased out, the statement adds. The timing for this phasing out will be announced in February 2012, when the list is notified. It is expected that the phasing out of negative list will be completed before the end of 2012.
Mahmood said that as a member of the World Trading Organisation (WTO), Pakistan was committed to granting MFN status to India.
“Under WTO, members are to grant MFN to each other. That obligation stands and will be completed when there is no list (positive or negative),” Mahmood told reporters, adding that MFN would be given once the progress on the lists is reviewed.
Khullar said the removal of the positive and negative lists and the gradual phasing out will give a significant boost to trade between the two countries.
Other steps
At the conclusion of talks today, both sides decided to increase trade through the Attari-Wagah land route by the end of February 2012 by increasing the number of trading hours and allowing for movement of containers into each other’s territories.
A committee set up to examine electricity trade will meet in Islamabad by the first week of December. Grid connectivity between Amristar and Lahore to enable trading of up to 500MW of power will be examined at the meeting, the joint communiqué said.
The two countries also discussed the initiation of trade in petroleum products and agreed upon slashing duties on a specified number of items in a phased manner. They reiterated the need to increase bilateral trade from the current $2.6 billion to $6 billion by 2014.
Both sides also decided to encourage outreach programmes between business communities of the two countries. A delegation comprising officers from various regulatory bodies will visit Lahore and Karachi in the first quarter of 2012 to apprise them of India’s trading standards and regulations.
To allow for this and subsequent such exchanges, secretaries from the Indian Home Ministry and Pakistan’s Interior Ministry will meet in December to finalise a deal on creating a liberal business visa regime.
Progress on all these fronts will be reviewed by the commerce secretaries during April-May in Islamabad. Meanwhile, the Indian minister for commerce, industry and textiles, Anand Sharma, is likely to visit Pakistan by February 2012 to meet his Pakistani counterpart Makhdoom Amin Fahim.
Both sides also agreed to institute a mechanism for redressing grievances arising from clearance of trade consignments at land, sea and airports, read the joint statement.
‘Don’t expect miracles’
The Indian defence minister, meanwhile, struck a cautious note: “Don’t expect miracles,” Antony said on the sidelines of a conference organised by the Indian Institute of Defence Studies and Analyses, a government-funded defence think tank. “At the moment, we find a positive sign in relations with Pakistan in the area of economic cooperation. It is a good beginning [and] a positive signal. But we cannot expect miracles. Beyond that we cannot say,” Antony said.
“There are already clear signs that India-Pakistan trade relations might improve and expand. The expansion in cooperation has created an atmosphere to expand the dialogue on security cooperation,” he said.
(Read: Pakistan-India trade)
Published in The Express Tribune, November 16th, 2011.
Correction: An earlier version of this article carried an incorrect caption with the image.
COMMENTS (19)
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LOL @ Indians commenting...
The Indian world view is very humorous: "every one needs India and India doesnt need anyone"
As far as I remember, world was doing pretty well without India as a booming economy, nobody was missing anything - and sorry to burst your ever growing ego-bubble but India is still home to the largest poor people in the world - even when defined by your own poverty standard which is a laughable Rs. 21 per day (which is not even good enough for two squre meals a day) If we go by the UN standards of a dollar a day - it would amount to more than 70% of India's population - India shining?? Yeah right... ;-)
Improving trade is a good idea - but it takes two to clap. With all the non tariff barriers enacted by India under the false pretense of 'quality standards' is an eye wash when even the local Indian companies fall way below the quality being expected by the importers.
Indians just wish all the 'bad' things would just disappear if they would just ignore them - wishful thinking indeed...
@Phannay Khan: The odds are that Pakistan may not survive current situation to last another hundrd years. The even important aspect is not one penny will be lost by India if do not give anyway to Central Asia. india does not need nuisance at its western borders-like sending terrorists. Otherwise what makes you think India would care.... There are serious survival issues for Pakistan-hundreds of them before Pakistan can have time to think for Kashmir.
@Phannay Khan:
Lets be clear. You don't speak for Pakistan. The majority of Pakistanis are reasonable and want good relations with India. Free trade will be good for both countries. So you can rant and rave all you want - it just makes you look silly. Most Pakistanis reject the prejudices which you are showing in your posts. And this has absolutely nothing to do with Kashmir. Feel free to go and settle in Afghanistan, Kashmir, Iraq or any of the other places you're so worried about. I don't see any of them showing particularly great concern for Pakistan and see no reason why we should care about them.
@Arjun: LOL. Before inviting others to live in 21st century , you learn to live yourself into it first. Ask yourself if Mentally you are not living in 18th century? The Values you demonstrated here i.e. Independence of a nation and its rights and How you justified US invasion in those countries, forces me to place you in the stone age right away. Thats exactly where I am going to place you right now. When you will grow up and come back, which I doubt, then we will talk about rest of the issues that you referred. Until then , have a pleasant trip!!!!. @66: For you I just have one message and that is try to pass through Pakistani territory your labor and goods, if you think you are capable of doing it. Our economics is our issue. You can better start mind your own Business. Go do something about your Mega Corruption scandals in Govt. that's creating enormous poverty in your country instead of giving others economics lectures. People of Pakistan do not need you. Period. You are no match to China and China is our friend. You like it or don't like it? It's your problem. We are Not changing our opinion about China for you. You can Pray ( that's all you can do) that Pakistan implodes from within ( And thats exactly the reason why Pakistani consider you people an enemy) but your prayers are not going to bear fruit. Bottom line is that you as a country is the last on Pakistanis List where as China is On top. I think you got the Picture. Think about it why it is so if you have some brain which I very much doubt.
@Phannay Khan:
This is not the lord of the rings where you can prevent someone from passing. Especially when Pakistan is economically very weak. It is Pakistan that needs India more than India that needs Pakistan. The sooner you figure that out the better for you. Or Pakistan can continue to live on left overs of other countries. You know how much the so called all weather friend China gave Pakistan for the damage during floods. 5 million dollars for 7 million people displaced. Thats the biggest joke in the world. Its like throwing pocket change at someone and telling them to go build a house. There are no free lunches in this world and Pakistan for some reason thinks it should be treated with equality when it doesnt bring anything positive to the table. Pakistan is the only country that negotiates as if it has a grenade in its hand and threatens to blow itself up and everybody around with it if not helped. At some point countries will just step back and watch Pakistan implode from within and that will be a really sad day.
Phannay Khan, we will be ready to welcome you to the 21st century whenever you feel like it.
Afghans and Iraqis were living under the worst kind of regimes earlier and the US has spent a lot of fortune to make their lives freer and better. But this is irrelevant to this article.
About Kashmir: once the relationship between India and Pakistan improves, finding a resolution to Kashmir will not be hard. Most likely, borders will become softer and the question of who governs the area wilp become moot as everyone will be able to travel freely. That is, if people like you give up your hatred for non-Muslims and stop your constant attacks in India.
@Abba Jee: You are absolutely correct.
@Phannay Khan: If you do not give MFN you violate WTO agreement. So that is your choice. India is not dying for the MFN. As for the Central Asian transit, the countries of Central Asia needs India more than India needs them. India will manage oil from other sources but can the Cental Asian countries afford to keep away from the Indian Market. What if they charge a premium to you for blocking the transit. Can you pay ? There is a big hole in you pocket, isn't it?
There are only two guys in the picture....where as the caption reads..
Indian Commerce Secretary Rahul Khullar (L) looks as Indian Minister of Commerce and Industry Anand Sharma (C) and Pakistan's Commerce Secretary Zafar Mahmood (R) shake hands during a meeting in New Delhi on November 15, 2011. PHOTO: AFP
This trade should not come at the cost of local industries. Ignore India please. We have learned to fend off attacks from Chinese goods but two monsters in one place is not a good idea. Our businesses will be destroyed.
Aditi WTO is known as World Trade Organization and not World Trading Organization. I believe that India and Pakistan should sign a free trade agreement which seems to be in vogue world over. It will help improve the living standards of both nations and will bring them closer. However the hatred of Hindus of Islamic fanatics will not let this happen and they will strive to keep Pakistani citizens poor and uneducated.
This means that despite all the talk MFN to India will not happen before Feb 2012. Of course targets frequently get missed to it COULD BE later.
Wayto go Pak. Getting the benefit from India about withdrawing the EUU objection without truly giving anything in return except a lot of headlines and photo-ops
Pakistan and India's trade should be based on fairness.No country should have undue advantages. Improving trade relations are very important but even more important is peoples to peoples contact and visa process for common man should be made much more simpler.
. Take my words , we Pakistanis will not give you way to the central Asia that you are dreaming until Kashmir is resolved. If not, Keep signing these MFN's for the next 100 years, We will make sure you do not get passed.
Cautionary note: Whenever ties with India improve, there is a terrorist attack in India or Kargil. India should not let its guard down.
m marvelling at the uncanny physical resemblance of this Commerce Secretary guy with president zardari..
no offence Zafar Mahmood sb ;p if u r really not a distant cousin of zardari sb