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Pak nod to negative list, Indias MFN status not far
Now almost 90% items can be traded with Pakistan as opposed to
17% earlier
The Pakistan Governments decision to switch over to a negative
list regime fortrade with India has paved the way for formally
according the Most Favoured Nationstatus to the latter by the end
of this year
The negative list would be phased out by December 31, 2012 to
complete theprocess of normalisation of trade between the two
countries
NEW DELHI: Pakistan's cabinet on Wednesday approved a proposal
to ease trade with India byswitching to a negative list-based
import regime and following it up with a most-favoured-nation(MFN)
trade status by the year-end.
The move will increase the number of items Indian exporters can
sell to Pakistan by nearly three
times. India had given MFN status to Pakistan 16 years ago,
though Ismalabad claims there arestill several non-tariff barriers
that its exporters face.
"The federal cabinet unanimously approved the phasing out of the
negative list existing betweenPakistan and India by December 2012,"
an official release from the prime minister's secretariat
inPakistan said, adding, "After that, the process of trade
normalisation between the two countrieswill be completed." The
development drew cheers from New Delhi, which was disappointedwhen
the Pakistani cabinet could not approve the negative list during
Indian Commerce MinisterAnand Sharma's visit earlier this month
because of objections from its textile ministry.
"It reaffirms the commitment of both governments for trade
normalisation as per the roadmap
drawn during the visit of Pakistan commerce minister in
September last year," Sharma said,adding that it will mark a
dramatic shift in imports as now almost 90% items can be traded
withPakistan, as opposed to 17% earlier.
The two ministers had set a deadline of discarding the positive
list in favour of a negative list byFebruary 2012, and phasing out
the negative list by the end of the year.
However, key items like automobiles and pharmaceuticals are
likely to be on the negative list tillthe time the MFN status is
given. Pakistan has avoided use of the sensitive term to pre-empt
areaction from hardline groups.
Lashkar-e-Taibafounder Hafiz Mohammad Saeed has reportedly said
the grouping will opposeany move to open up Pakistani markets and
give MFN status to India.
Pakistan's commerce ministry had to almost double the number of
items on its proposed negativelist from 636 to more than 1,200 to
accommodate concerns of certain sectors such as textiles.However,
the progress on trade ties has drawn praises from experts.
http://economictimes.indiatimes.com/topic/most-favoured-nationhttp://economictimes.indiatimes.com/topic/most-favoured-nationhttp://economictimes.indiatimes.com/topic/most-favoured-nationhttp://economictimes.indiatimes.com/topic/Lashkar-e-Taibahttp://economictimes.indiatimes.com/topic/Lashkar-e-Taibahttp://economictimes.indiatimes.com/topic/Lashkar-e-Taibahttp://economictimes.indiatimes.com/topic/most-favoured-nation
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"The most important point is that they (the Pakistanis) are
sticking to deadlines. Maybe, theyhave compromised a bit by
increasing the negative list, but it is only an attempt to
takeeverybody along so that there is no opposition at a later
stage," said Nisha Taneja, professor atDelhi-based think-tank
ICRIER.
Taneja said the size of the negative list should not matter, as
within a year everything would bephased out. The negative list
mostly includes items from sectors such as automobiles,
textiles,pharmaceuticals and chemicals.
Pakistan currently imports just 1963 items from India based on a
small positive list, as againstmore than 9,000 items it imports
from other countries.
It is obliged under the WTO rules and the South Asia Free Trade
Agreement to confer the MFNstatus on India by allowing import of
all items it buys from other countries.
India exported goodsworth $2.33 billion to Pakistan last year,
while imports from the neighbourstood at $330 million.
India and Pakistanare also working on liberalising their
bilateral visa regime and allowing bankbranches to be opened up in
each other's countries. The two nations have set up groups to
discusstrade in petroleum products and electricity, too.
http://economictimes.indiatimes.com/topic/India%20exported%20goodshttp://economictimes.indiatimes.com/topic/India%20exported%20goodshttp://economictimes.indiatimes.com/topic/India%20and%20Pakistanhttp://economictimes.indiatimes.com/topic/India%20and%20Pakistanhttp://economictimes.indiatimes.com/topic/India%20and%20Pakistanhttp://economictimes.indiatimes.com/topic/India%20exported%20goods
