Pak defers India's MFN trade status

With the political tensions rising in Pakistan, Prime Minister Yousuf Raza Gilani's Cabinet on Tuesday deferred a decision on moving ahead with the negative list of goods to pave the way for granting India most-favoured nation (MFN) trade status.

Pakistan commerce minister Makhdoom Amin Fahim had indicated on Monday that the February deadline for the negative list was not likely to be met but it would come through soon.

However, with the Cabinet not even taking up the matter at its meeting, it is clear that the MFN issue has been shelved for now.

Gilani has been chargesheeted for contempt of court under the direction of the Supreme Court for not taking up money laundering issues with the Swiss government.

With radical elements in Pakistan opposed to the trade treaty with India, Gilani does not appear to be in a position to push through the decision.

Federation of Indian Chambers of Commerce and Industry (Ficci) president R. V. Kanoria said: "The decision does not reflect the sentiments of businessmen on both sides, who are keen to engage with each other. But the political will is equally important."

Confederation of Indian Industries (CII) president B. Muthuraman said: "I am disappointed. But I still hope it (MFN) will happen."

Pakistan currently allows exports from India of only 1,938 goods, which figure on the positive list. However, India has already extended MFN status to Pakistan and does not impose similar restrictions on exports to or imports from the country.

Islamabad had announced in November that it had granted "in-principle" MFN status to India. The first step for implementing the decision entails replacing the positive list with a much smaller negative list.

Addressing a meeting of Pakistan and Indian business chambers at Karachi on Tuesday, Commerce Minister Anand Sharma said, "I will be discussing the negative list and MFN issue with the Pakistan commerce minister at Islamabad tomorrow (Wednesday) and we are hopeful of a positive outcome." Pakistan has to accord MFN status to India because of its obligations under the World Trade Organization (WTO) protocol.

Sharma said India and Pakistan have to move to a liberal trade regime under a small negative list.

He said India was ready to allow multiple-entry visas to a list of businessmen compiled by two leading chambers of commerce from Pakistan, if Islamabad extends the same treatment to a list of Indian businessmen prepared by CII and Ficci.

Courtesy: Mail Today