Speaking to FE, Pakistan's permanent representative to the WTO, Muhammad Saeed said, "There is lot of illegal cross-border trade taking place between the two countries. Both the governments should accept the reality situation of the market and accordingly make suitable changes in their trade law."
Saeed admitted that India has unilaterally accorded MFN status to Pakistan. He said that Pakistan according MFN status to India in return is not that important in making suitable changes in trade laws. Saeed was recently in India to participate in a South Asian trade conference hosted by the Centre for Trade and Development (Centad).
He expressed the hope that the South Asia Free Trade Agreement (Safta) would ultimately boost intra-regional trade, which was now below 5%.
He said that Pakistan's exports to Saarc countries increased from 2.7% in 2003 to 4.5% in 2006. About 45% of the exports was of textiles. In the same period Pakistan's imports from Saarc countries increased from 2.4% in 2003 to 4.1% in 2006. In the same period Pakistan's global exports grew from $12 billion to $17 billion.
Saeed, however, said that exports of goods and services as percentage of GDP in 1990-2005 for all South Asian countries, excepting Pakistan increased. For Pakistan it was a marginal decline, he said.
On the issue of exporting wheat to India, Saeed said, "Our wheat output in the current season was 15% more than the consumption demand. We exported wheat, including 500,000 tonne to India at about $200 a tonne. Recently, our domestic prices have shot up due to hoarding of stock and market manipulation and we are importing wheat at $460 a tonne."
The former commerce secretary of Bangladesh, Suhel A Choudhury that an FTA with India was mooted in March 2003 in Delhi and subsequently it was discussed in the Dakha meeting in October 2003, but unfortunately no progress has been made in this direction.