India welcomes Pak's efforts to liberalise bilateral trade

Welcoming Pakistan's policy initiative to liberalise bilateral trade, India today said the move would open business opportunities by providing market access to Indian goods in the neighbouring country.     

Commerce and Industry Minister Anand Sharma said that this development reaffirms the commitment of both the governments for trade normalisation.

Pakistan has unanimously approved a proposal to switch over to a negative list regime for trade with India and phase it out by the year-end as part of measures to fully normalise bilateral economic ties.

According to sources, the move will allow Pakistan to import some 6,800 items from India. At present, Pakistan allows import of only 1,946 Indian items, listed in the positive list.

"This will mark a dramatic shift in the lines that can be traded as now almost 90 per cent items can be traded with Pakistan as opposed to 17 per cent earlier," Sharma said in a release.

It would translate into a huge opportunity for Indian businessmen, who will be able to ship all but few items to a 150 million Pakistani market through land, air and sea routes.

"I am happy that this has been achieved. We believe that strengthening economic engagement between India and Pakistan lies at the heart of building enduring peace and stability in this region. Flourishing trade is the biggest confidence building measure among any two nations," Sharma said.

He said that now there is a need to continue the momentum of regular exchanges.

Sharma visited Pakistan earlier this month with a huge business delegation. There, in a joint statement, India and Pakistan agreed that Pakistan will move from a positive list to a small negative list.

Over 1,200 items are there in the Pakistan's negative list, which they intends to phase out in three stages.  Direct trade between India and Pakistan constitutes less than one per cent of their respective global trade. 

India exported goods worth $2.33 billion to Pakistan last year while its imports were $330 million.

However, Pakistan has consciously chosen not to play up the fact that the phasing out of the negative list would lead to giving India Most Favoured Nation status due to opposition from several quarters, including the Defa-e-Pakistan Council, a conglomerate of hardline and extremist groups.

Lashkar-e-Toiba founder Hafiz Mohammad Saeed, who played a key role in cobbling together the Defa-e-Pakistan Council, has said the grouping will oppose any move to give India MFN status and to open up Pakistani markets.