Indian commerce minister on 'historic' visit to Pakistan, Feb 13

NEW DELHI: Commerce, Industry & Textiles Minister Anand Sharma, along with an 80-member strong delegation will visit Lahore, Karachi and Islamabad to interact with Pakistani CEOs and officials on a three day visit starting February 13.

"The amount of interest for this historic visit is huge. Both countries are going to gain from this visit," Federation of Indian Chambers of Commerce & Industry FICCI President R V Kanoria told Economic Times on Friday. The main object of the three-day visit is to completely normalize trade ties between both countries.

"I have no doubt in my mind that bilateral trade which currently stands at about $3 billion can be raised to $10 billion if trade through other countries (Dubai, Singapore and Central Asian countries) is channelized into direct exchanges between the countries," Kanoria said.

India and Pakistan trade with each other in amounts less than one per cent of their respective global trade. Pakistan maintains a positive list of 1,938 items which can officially be imported from India. India extended Most Favored Nation (MFN) status to Pakistan and does not impose equivalent formal restrictions on exports or imports from Pakistan.

The Indian industry would like the Pakistan government to adopt a negative list approach at its earliest and subsequently grant MFN status to India, reported the Economic Times. From February 2012, Pakistan is expected to shift to a negative list of a few items which it would not import from India, the report added. By the end of 2012, it has been agreed that the negative list itself should be removed.

"Several restrictions on official trade compel both the countries to import certain goods from far off sources which they can easily import from each other," Kanoria added. India- Pakistan trade would ensure cheaper raw materials and low transportation which would translate into quality goods at competitive prices for both the countries, he said.

There is large potential of trade in services, especially Indian export services like IT and IT enabled services, medical, construction, tourism. Potential for joint ventures exists in various areas including chemicals, textiles, hydropower, tourism & IT.

India had agreed to sign three pacts -- Customs cooperation, mutual recognition agreements on quality certification and grievance redressing mechanism -- to convince its neighbor that it was serious about removing NTBs. But only the customs cooperation pact is ready. New Delhi had some problems with the Pakistan draft on grievance redressing and has prepared a counter-draft. "Until both sides agree, the draft cannot be finalized and placed before the Cabinet," an Indian official said.

"These things do take time. When Pakistan can take 17 years in agreeing to grant MFN status to India, it has to be understood that other dispensations can take at least a few months," the Indian official said.

Pakistan says a big reason for its trade gap with India is the NTBs. India exported goods worth $2.33 billion to Pakistan last year while its imports from that country were a mere $332 million.

"The amount of interest for this historic visit is huge. Both countries are going to gain from this visit," Federation of Indian Chambers of Commerce & Industry FICCI President R V Kanoria told Economic Times on Friday. The main object of the three-day visit is to completely normalize trade ties between both countries.

"I have no doubt in my mind that bilateral trade which currently stands at about $3 billion can be raised to $10 billion if trade through other countries (Dubai, Singapore and Central Asian countries) is channelized into direct exchanges between the countries," Kanoria said.

India and Pakistan trade with each other in amounts less than one per cent of their respective global trade. Pakistan maintains a positive list of 1,938 items which can officially be imported from India. India extended Most Favored Nation (MFN) status to Pakistan and does not impose equivalent formal restrictions on exports or imports from Pakistan.

The Indian industry would like the Pakistan government to adopt a negative list approach at its earliest and subsequently grant MFN status to India, reported the Economic Times. From February 2012, Pakistan is expected to shift to a negative list of a few items which it would not import from India, the report added. By the end of 2012, it has been agreed that the negative list itself should be removed.

"Several restrictions on official trade compel both the countries to import certain goods from far off sources which they can easily import from each other," Kanoria added. India- Pakistan trade would ensure cheaper raw materials and low transportation which would translate into quality goods at competitive prices for both the countries, he said.

There is large potential of trade in services, especially Indian export services like IT and IT enabled services, medical, construction, tourism. Potential for joint ventures exists in various areas including chemicals, textiles, hydropower, tourism & IT.

India had agreed to sign three pacts -- Customs cooperation, mutual recognition agreements on quality certification and grievance redressing mechanism -- to convince its neighbor that it was serious about removing NTBs. But only the customs cooperation pact is ready. New Delhi had some problems with the Pakistan draft on grievance redressing and has prepared a counter-draft. "Until both sides agree, the draft cannot be finalized and placed before the Cabinet," an Indian official said.

"These things do take time. When Pakistan can take 17 years in agreeing to grant MFN status to India, it has to be understood that other dispensations can take at least a few months," the Indian official said.

Pakistan says a big reason for its trade gap with India is the NTBs. India exported goods worth $2.33 billion to Pakistan last year while its imports from that country were a mere $332 million.