Pak agrees to non-discriminatory trade with India

After two-day talks between commerce secretaries of India and Pakistan, a joint statement said the two sides would set up two groups of experts to examine the "feasibility, scope and modalities" for a new initiative to enable trade in electricity and to "initiate and substantially expand trade in all types of petroleum products".
The group on electricity trade will be set up by the end of June and it will hold its first meeting by October to study issues like suitable sites and routes for transmission lines, funding mechanisms and related matters.

The group on petroleum products will be set up by June 15 and will discuss trade arrangements, building of cross- border pipelines and use or road or rail routes, including the Munabao-Khokrapar route. It will hold its first meeting before September.

During the talks, Islamabad said it would take "immediate necessary steps to ensure that non-discriminatory trade regime is operationalised at the earliest".

Pakistan recognized that the grant of Most Favoured Nation status to India will help in expanding bilateral trade and both sides agreed to remove non-tariff barriers (NTBs) and other "restrictive practices" that hamper commerce, the joint statement said.
The Pakistani side has set in motion the consultative process and information on reservations and objections is being collected from all stakeholders, including trade lobbies and manufacturers, to replace the current 'positive list' with a 'negative list', Pakistan’s Commerce Secretary Zafar Mahmood told the media at the conclusion of his talks with his Indian counterpart Rahul Khullar.

The joint statement said this process will be completed by October.
While India allows import of goods from Pakistan on all but a few items in the negative list, it is other way round for Islamabad. Pakistan disallows import from India on all but those listed in the positive list.

Mahmood dismissed the perception that the granting of MFN status to India was linked to the resolution of the Kashmir dispute.

"The chambers have not raised any objection to the grant of MFN status to India provided India lowers non-tariff barriers," he said.

Speaking to Indian journalists, Khullar said the implementation of a non-discriminatory regime was required to fulfill Pakistan’s obligations under the WTO and South Asian Free Trade Area pact.The two sides, which were holding their first trade talks since the 2008 Mumbai terror attacks, agreed that "increase in trade and economic engagement would help not only in the mutual quest for national development but also contribute to building trust".

"Whatever is in our benefit should be imported from India, just as we are importing from the rest of the world," Mahmood said.The two sides decided to establish a working group to reduce and remove tariff and non-tariff barriers.

The group, comprising technical experts and representatives of regulatory bodies, will hold its first meeting by September.

Khullar said a new Rs 150-crore integrated check post built by India at Wagah is expected to give a major boost to trade.

The check post, built on 100 acres, is expected to functional by October.
He said closer coordination is needed to open the second gate at Wagah and new dedicated roads have to be built for passenger and freight traffic.

"Pakistan has to now build infrastructure in line with that of India," Khullar said.
Both sides agreed to expand trade through the Wagah- Attari route by increasing trading hours, expeditiously clearing cargo and facilitating movement of larger vehicles and container traffic.

A new initiative to promote bilateral trade in Bt cotton seeds was identified by both sides.

This will help Pakistani farmers and its textile industry by raising cotton yields and ensure better cotton security, the joint statement said.

Cooperation in information technology would also be encouraged through the private sector, it said.

Both sides also agreed to fast track the process for opening bank branches in each other’s countries.

Indian officials said Pakistan had not raised the issue of a concessionary package being backed by the European Union to help the country in the wake of last year’s devastating floods.

Mahmood said the package was framed by the EU, which took it to the WTO.
"It has been tabled by (the EU) and it would be defended by them. Pakistan is only a beneficiary of this. It is always our desire that India should have no objection to the grant of this package," he said.

Both sides further decided that the commerce secretaries would meet twice a year to oversee the working of a joint working group on 'Economic and Commercial Cooperation and Trade Promotion'.

Khullar said the next meeting of secretaries will be held in New Delhi in November.