MFN status to India: Army not part of India trade equation, says Gilani

PM empowe­rs commer­ce minist­ry for negoti­ations in Delhi.

Kamran Yousaf/abdul Manan November 05, 2011


The prime minister’s message to those looking towards the army regarding the move to grant India a symbolic trading status is simple: it’s none of the military’s business.

Speaking to reporters at his residence in Lahore on Friday, Yousaf Raza Gilani said the most favoured nation (MFN) issue does not involve the army, and stressed that only the business communities and stock exchanges of Pakistan and India are legitimate stakeholders – and both are on board, as are the political parties of the ruling coalition.

He said that the cabinet has, in principle, given the go-ahead to the ministry of commerce to negotiate with their Indian counterparts.

However, notwithstanding the PM’s firm stance, senior civil and military officials held meetings at the foreign ministry to discuss the implications of granting MFN status to India.

The meetings were chaired by Foreign Minister Hina Rabbani Khar and attended by military and intelligence officials. The foreign ministry did not divulge details regarding the participants.

“As part of regular consultations, the foreign minister today consulted all stakeholders on foreign policy issues including the resumed dialogue process with India, at the foreign ministry,” said a ministry statement.

In Lahore, Gilani concentrated on the commerce ministry’s role as Pakistan and India begin the nitty-gritty of negotiations. The PM said the ministry would need to take important decisions independently when it comes to bargaining with India over trade policy, hence it had sought the cabinet’s go-ahead.

Pakistan has already bestowed MFN status on more than 100 countries. The somewhat misleading designation ‘most favoured nation’ should not detract from the main concern which lies ahead for the two countries: working out mutually beneficial and lasting agreements.

While the MFN status will remove discriminatory higher pricing and duty tariffs that stand as barriers to export between the neighbours, non-tariff barriers continue to stand in the way of increased trade, say analysts.

Nevertheless, the meetings in Islamabad prove that Pakistan’s military cannot be totally ignored. Indeed, the consultations took place against the backdrop of murmurs that Pakistan might review its decision to fully normalise trade ties with India.

In a clear departure from a decades-old policy, the federal cabinet on Wednesday unanimously decided to grant India MFN status. Since then, mixed signals emerged from different government quarters about the issue.

A Reuters report, which quoted an unnamed Indian official accusing Pakistan of backtracking, added to the confusion. Pakistan moved swiftly to dismiss the claim.

Pakistan is not backtracking,” Foreign Office spokeswoman Tehmina Janjua told Reuters. “Pakistan clearly stated that our cabinet gave approval to move forward on MFN status in principle.”

Commerce Secretary Zafar Mehmood was also adamant that the deal was still on.

“The cabinet has given approval for the complete normalisation of the trade relationship, and MFN is fully included in it and it is part of it,” Zafar said in comments broadcast on state television.

“We are extremely hopeful that there will be a major breakthrough in the next round of commerce secretaries’ meetings on November 14, 15 in Delhi,” Mehmood added. “We will finalise all the details in that meeting.”

Gilani was in an equally positive mood. Asked whether all stakeholders are on board, the PM said that the coalition government is united on the issue.

The PM was quick to reassure those threatened by granting India the trade status, saying that the interests of local and domestic industry would be protected.

Gilani also affirmed the cabinet’s executive powers. “We can brief Parliament over the cabinet’s decision of going ahead with MFN, but according to my point of view it is not necessary. Only cabinet approval is necessary to negotiate with other countries,” he said.

Giving an example of countries which had set aside political difference for bilateral foreign trade, Gilani pointed to China and India.

Friday’s intrigues came ahead of the South Asian Association for Regional Cooperation (SAARC) summit in Maldives next week. Gilani and his Indian counterpart Manmohan Singh are likely to meet on the sidelines of the conference.

(Read: Liberalising trade with India)

Published in The Express Tribune, November 5th,  2011.


JJJackxon | 11 years ago | Reply

It is simply wonderful to see young, engaged Pakistanis caring enough to argue their point of view with passion without any threats of violence. If given a chance, and that may or may not happen, the same people can make a success of Pakistan.

sam | 11 years ago | Reply

@Maria ... And PA never supported these militia groups ? and yea missing persons in Balochistan are also done by RAW right ?

Can we please cut the conspiracy theory crap and for one use our brains and analyse the whole situation. If you don't even accept what the problem is than how are you going to solve it ?

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