India is of the view that there is no way (to strengthen ties between India and Pakistan) other than building an atmosphere of confidence and trust. This is the only way for ensuring peace and stability. And, for that, the only way is economic partnership, said commerce and industry minister Anand Sharma at the ongoing Global Partnership Summit organised by the Confederation of Indian Industry here.
A 10-member Pakistani business delegation, led by Pakistan commerce minister Makhdoom Amin Fahim, that was supposed to participate in the summit had cancelled its visit due to the strained relationship between the two nations in the wake of killing of two Indian soldiers by the Pakistani troops.
Moreover, talks on the most favoured nation (MFN) issue also took a hit as Islamabad did not honour its commitment of granting the MFN status to India by December 31, 2012.
India had granted Pakistan the MFN status under the World Trade Organisation (WTO) rules in 1996, which means that in terms of trade matters it would be treated like any other country. MFN status doesnt mean any additional benefits, but merely that the country concerned will not be discriminated against in terms of trade.
We have taken a decision on investments and opening bank branches. I know we have friends from Pakistan in the audience here. Please go back and remind them what we discussed last February, where we are and not to allow anything that actually holds this region back, Sharma added.
His sentiments were echoed by the industry which pushed for the MFN status.
The tugs and pulls are at the political level and this is where people-to-people contact can be established. We have asked for MFN, but they have to look at their own internal issues, said Ajay S Shriram, chairman and senior managing director, DSM Shriram Consolidated.
However, a small delegation comprising six Pakistani businessmen attended the summit and emphasised on greater bilateral trade.
If you see the current status, though India gave Pakistan MFN status, 85% goes from India into Pakistan and only 15% the other way. We dont mind Pakistan having a trade deficit or surplus with India, but more bilateral trade is beneficial. Even if we are importing, we are importing cheaper products compared to other destinations. People have a view in Pakistan that we do not have a level-playing field, said Amin Hashwani, director, Hashwani Group of Industries.
Over April-December 2012, Pakistans exports to India rose more than 50% while those from India to Pakistan declined by 10%. The number of cargo trucks from Pakistan to India increased by 101%.