Non-discriminatory access: Pakistan, India inch toward trade liberalisation

Commerce minister says free trade agreement with China to be renewed

ISLAMABAD:

Pakistan and India are getting closer to sealing a deal to liberalise trade between the two neighbours, Commerce Minister Khurram Dastgir Khan told the Senate on Friday.

“Pakistan may grant ‘non-discriminatory market access’ (NDMA) status to India. The new deal will protect our business interests,” said Dastgir in response to a question posed by Senator Syed Muzafar Hussain Shah, adding that Prime Minister Nawaz Sharif had personally identified liberalised trade with India as a policy priority.

NDMA status is essentially the same as granting Most Favoured Nation (MFN) status, which Pakistan is obliged to grant India under Islamabad’s treaty obligations to the World Trade Organisation (WTO). Seeking to pre-empt any populist backlash against the idea, Dastgir explained what the trade deal would mean. “There is an incorrect perception [among many] that Most Favoured Nation means giving India extraordinary market access, which is actually not correct. That is why we decided to replace this term with NDMA,” he said.

Pakistan and India both became founding members of the WTO in 1995 and as part of the agreement were required to grant each other MFN status. India did so in early 1996, but Pakistan has yet to reciprocate. Pakistan’s initial approach to trade with India was only to allow a certain number of items – 1,963 to be precise – and banning all others. Under the Zardari Administration, that approach was moved towards one that banned 1,209 items and allowed trade in all the rest.

“Our main purpose is to protect our agriculture business first [against competition from] India,” said Dastgir, defining the scope of Islamabad’s stance in negotiations with New Delhi.

Dastgir also said the government would renew the free trade agreement with China. Once again addressing populist concerns from senators, Dastgir pointed out that exports to China have grown more rapidly since the free trade agreement was signed in 2007. Pakistan’s exports to China have risen at an average rate of nearly 24% per year since the agreement was signed. Imports from China, meanwhile, have only grown at an average of less than 7% per year over the same period.

The minister introduced to the Senate the Companies (Amendment) Bill of 2015 and the Stock Exchanges (Corporatisation, Demutualisation and Integration Amendment) Bill of 2015, both of which were referred to the relevant standing committees. He also introduced the Gas Infrastructure Development Cess Ordinance 2014 and a report on the first biannual monitoring of the implementation of National Finance Commission Award for July-December 2013.

YouTube blocking issue

In response to a query by Senator Osman Saifullah, Technology Minister Anusha Rehman said the matter of blocking the video-sharing website YouTube is being litigated in the Islamabad High Court, which has directed Pakistan Telecommunications Authority to keep updating the court on removal of ‘blasphemous’ content from the website. “We are still not able to remove blasphemous content from YouTube—the basic reason which led to the closure of YouTube in the country,” Rehman informed the lawmakers.

Energy crisis

During the course of the proceedings, Senator Zahid Khan of the Awami National Party informed the house that both committees of parliament assigned to take up issue of the recent petroleum crisis could not get satisfactory answers from the officials responsible for managing the energy sector.

“In my view, the government, the finance minister, the water and power ministry, Nepra and the petroleum ministry are responsible for this crisis,” he said.

Published in The Express Tribune, February 7^th, 2015.