Pakistan agrees to grant India MFN status

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Huma Siddiqui: New Delhi, Jul 13 2011, 02:49 IST

To explore untapped potential in its trade with India, Pakistan has agreed to grant India the most favoured nation (MFN) status. This was conveyed to Lok Sabha Speaker Meira Kumar by her Pakistani counterpart, National Assembly Speaker Fehmida Mirza, on Monday.

The trade between the two neighbours currently stands at $ 2.5 billion, with a total of 1,946 items being traded between them.

Even as formal talks between the two countries’ foreign ministers are slated to take place in New Delhi this month-end, Pakistan is also keen that the 18-point agenda agreed upon during the commerce secretaries’ meeting in April this year is implemented.

According to senior officials, Pakistan is paying 35% extra cost on trade logistics through third countries and illegal channels. The MFN status would allow Pakistan to directly import such products from India.

Also, it could save $1.5 billion annually by redirecting imports of items like steel, chemicals, cosmetics, pharmaceuticals, machinery and equipment and processed food from India and curtailing smuggling.

Last week, in a joint statement at the end of a seminar organised by the India-Pakistan Chamber of Commerce & Industry, the industry captains suggested that Pakistan grant MFN status to India for expanding bilateral trade.

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