Indian businesses urge Pakistan to act on trade list

Thursday, 16 February 2012 21:55 - - {{hitsCtrl.values.hits}}

Reuters: Indian businessmen urged Pakistan on Wednesday to speed up normalisation of trade and travel ties between the nuclear-armed rivals, after India’s commerce minister arrived in Pakistan with hopes that thawed trade links could help ease political tension.

Pakistan agreed last November to open up more trade with India by replacing a list of items its bigger neighbour can sell across the border with a shorter list of items that cannot be traded -- a move regarded as key to improving commercial ties.

“It’s not peace that will lead to trade, but trade that will lead to peace ... The direction is right but the speed is not fast enough,” Rajya Kanoria, president of the Federation of Indian Chambers of Commerce and Industry, told Reuters.

“That’s the message I would like to give to the government of Pakistan and to the government of India. More to Pakistan, because that is really where the problems are right now. The signals coming out are mixed.” Pakistan late last year agreed in principle to grant access to imports from India under Most Favoured Nation status but has yet to fully implement the change.

But Islamabad also accuses India of dragging its feet on reducing or removing non-tariff barriers to Pakistani goods.

Pakistan has said it would notify India by this month of the “negative list” of items that cannot be traded with its neighbour and would ease visa rules that severely restrict travel across the countries’ heavily armed border. The list has yet to be completed, and Pakistan Commerce Minister Makhdhoom Amin Fahim said it was taking longer than expected because each item needed to be thoroughly evaluated.

“Our secretaries of commerce of India and Pakistan have had two meetings and they will meet in the near future and they are going to decide about each item. It’s a long list,” Fahim told reporters.

Lasting India-Pakistan peace is seen as vital to south Asia’s stability and to smoothing a dangerous transition in Afghanistan as NATO-led combat forces plan to withdraw from there in 2014.

Trade has long been tied to political issues between the hostile neighbours, which have fought three wars since independence from Britain in 1947, with the disputed region of Kashmir the cause of two of the conflicts.

Trade ties were severed after the second war in 1965.

Indian businessmen, part of a trade delegation headed by Indian Commerce Minister Anand Sharma that arrived on Monday, said their Pakistani counterparts had showed enthusiasm towards normalising trade.

“The pulse of the business community in Pakistan is in favour of economic engagement with India, opening up the trade,” Vikramjit Sahney, chief executive of trading and consultancy firm Sun Group, told Reuters.