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Pakistan to accord negative list trade regime

ISLAMABAD: Even as the two South Asian neighbours inked three important business deals on Wednesday, Pakistan said that the roadmap to accord ‘most favoured nation’ (MFN) status to India was s

Published: 16th February 2012 02:42 AM  |   Last Updated: 16th May 2012 05:57 PM   |  A+A-

ISLAMABAD: Even as the two South Asian neighbours inked three important business deals on Wednesday, Pakistan said that the roadmap to accord ‘most favoured nation’ (MFN) status to India was still on track with the negative list of trade regime with India likely to be approved this month.

“The ministers firmly reiterated that both sides would scrupulously adhere to the roadmap drawn up by the commerce secretaries for full normalisation of trade relations. It has been agreed that Pakistan will move from positive list to a small negative list by February 2012,” said a joint statement issued at the conclusion of talks between Commerce Minister Anand Sharma and his Pakistani counterpart Makhdoom Amin Fahim on Wednesday.

Sharma arrived in Pakistan on Monday on a historic visit, the first ever by an Indian Commerce Minister, accompanied by a 150 member business delegation.

When it approves the negative list trade regime, Pakistan will also announce the phasing out of negative list to move towards granting full MFN status to India. “It is expected that the phasing out will be completed before the end of 2012,” the joint statement said.

The roadmap was doubtful after the Pakistani federal cabinet on Tuesday decided not to approve the negative list trade regime with India.

In November 2011, their cabinet had “in principle” agreed to grant ‘most-favoured’ nation status to India. It had planned to move from the positive list, which allows trade on 1936 items to the negative list that bans just about 936 items by February 2012.

As per the deadline, this would be the first step to granting MFN status by the end of the year. India had already accorded Pakistan MFN status in 1996, but Pakistan businessmen have complained that there were too many non-tariff barriers in place for its proper implementation.

“The two commerce secretaries are discussing the positive and negative list. We expect to reach some conclusion by February end. I do not think that there will be any further problem,” Fahim said at a joint briefing.

Pakistani Commerce Secretary Zafar Mahmood clarified that the Pakistani cabinet had only “deferred” the decision, and not rejected the proposal. He added that it was likely that the commerce ministry would bring the negative list for India before the next cabinet meeting in the last week of February. “What I have been informed by my counterpart... they are unequivocal in reaffirming their commitment to what they have come to, that is to move to the negative list by February and we are in February,” Sharma said.

During the visit, three deals relating to  customs matters, mutual recognition between Pakistan Standard and Quality Control Authority and Bureau of Indian Standards and redressal of trade grievances between Pakistan and India were signed.  In a significant development, Reserve Bank of India has invited a delegation from State Bank of Pakistan to discuss the opening of bank branches in the first fortnight of March.

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