India has reportedly shared non-papers on proposed duty structure on Pakistani goods with Islamabad through diplomatic channels, which compelled the Commerce Ministry to plead its case for grant of NDMA or MFN status for India, well-informed sources told Business Recorder. “We received encouraging response from New Delhi after which the Commerce Ministry requested the Prime Minister to proceed further,” the sources added.
However, the ministry is neither aware of any consultation between the Prime Minister and the GHQ on this sensitive issue, nor confident of continuity in trade with India even after Islamabad accords much-debated Non Discriminatory Market Access (NDMA) to India.
Federal Cabinet is expected to debate trade normalisation pact with India in its meeting scheduled for Friday (March 21). If the Federal Cabinet approves NDMA for India, the Commerce Ministry will issue necessary notification after receiving official notification from India, the sources added. The Commerce Ministry’s top brass has spent two days in consultation with the India sensitive industry, ie, auto sector, pharmaceutical sector, steel sector, synthetic fibre and agriculture.
According to sources, the ministry has committed with the India sensitive industry that the National Tariff Commission (NTC) laws will be amended to safeguard the industry. However, some of the preferences of Indian sensitive industry will be affected after both the countries issue NDMA status notifications.
The sources said, the government will also announce very soon that the list of agriculture importable products from India will remain the same. Agriculture sector has announced a sit-in at Wagha border on March 31, 2014 against the grant of NDMA status to India. The policy statement on Pak-India trade liberalisation cannot be given in the Parliament until there is something concrete to share with the parliamentarians, said a senior official of the Ministry of Commerce during background interaction with media.
The official said the debate in the Parliament was linked with the approval of the deal by the Federal Cabinet, which will soon consider the summary of the Ministry of Commerce. It has been indicated to Prime Minister Nawaz Sharif that “sufficient commercial competitive advantage of Pakistan has been secured and the Federal Cabinet may take a positive decision,” said the official.
The official said India has indicated to accommodate Pakistan’s trade interests and is ready to allow the trade of goods in which Pakistan has competitive advantage. It has been conveyed to Indian Commerce Minister Anand Sharma that Pakistan’s trade interests are that Pakistan’s top export items should not be placed in Islamabad-specific sensitive list that India maintains under South Asia Free Trade Agreement (Safta). At present 95 percent items in which Pakistan enjoys strength are covered in 614 items that India has protected through its Pakistan-specific sensitive list.
“It is the best deal that any Indian government can offer to Pakistan and now the question is should we accept the offer or wait for new Indian government to come despite the fact the present offer is lucrative and protects the interests of the country,” he added.
Pakistan and India would not sign any new agreement, said the official. Instead the leftover parts of September 2012 agreement will be implemented. Now it’s our turn. He said China has also advised Pakistan that until the country is economically strong it cannot overcome its other problems. Pakistan will also open other borders for trade with India but the problem is the country has not yet established Land Port Authority, he added. “In short-term there will be trade diversion, not trade creation,” he added.