Pak grants MFN status for India

Islamabad, Nov 3 (PTI) After dilly-dallying for several years, Pakistan Wednesday granted the Most Favoured Nation (MFN) status to India in a significant step in improving bilateral ties and boosting two-way trade currently standing at USD 2.6 billion. "After a lengthy discussion and a briefing by the Commerce Secretary, the Cabinet unanimously approved the Commerce Ministry's summary to grant Most Favoured Nation status to India," Information Minister Firdous Ashiq Awan told a news conference. The MFN status, which means that Pakistan will give trade treatment to India at par with its other partners, is likely to boost the bilateral economic ties. India had granted the MFN status to Pakistan way back in 1996. In 2010-11, India-Pakistan trade stood at USD 2.6 billion. Pakistan's move to grant MFN status to India comes ahead of the November 10-11 SAARC Summit of the south Asian countries in Maldives, where the Prime Ministers of the two countries are expected to meet. All stakeholders in Pakistan, including the military, were "on board" for the decision to grant MFN status to India, Awan said. "The decision will lead to economic benefits and it is in the national interest," she said, adding that granting the MFN status to India would not in any way affect Pakistan's stand on the Kashmir issue. During the meeting of the Cabinet chaired by Prime Minister Yousuf Raza Gilani, several ministers raised concerns on issues like Kashmir which were discussed at length, Awan said. "Some Cabinet members had concerns about Kashmir, political issues and defence and strategic relations," she said in her opening remarks. "Others raised issues related to national sovereignty and Pakistan's territorial integrity. The Cabinet's decision will cause no harm to the Kashmir cause," she said. "Trade (with India) is a separate issue. It is a most important priority for Pakistan to continue its support for the Kashmir issue and the movement (for the right to self-determination)," Awan, a senior leader of the ruling Pakistan People's Party, said. Awan pointed out that China, one of Pakistan's closest allies, had bolstered its trade relations with India despite territorial disputes between the two countries. "We cannot live in regional isolation," she said. Responding to a question on whether the Kashmiri leadership had been consulted on the decision to grant MFN status to India, Awan said the two parts of Kashmir were already conducting trade across the Line of Control (LoC). Bus services too were operating across the LoC, she said. Awan said Commerce Minister Makhdoom Amin Fahim had briefed the Cabinet about how he had engaged the Kashmiri leadership on the MFN issue. After India granted the MFN status to it in 1996, Pakistan had held out on reciprocating the move, largely due to opposition from religious groups and some political parties which felt that extending the MFN status to New Delhi would affect Pakistan's stand on the Kashmir issue. Meanwhile, Commerce Secretary Mahmood said trade between India and Pakistan had continued uninterrupted between 1948 and 1965. During this period, the two countries signed 12 bilateral trade agreements. After the war of 1965, all these agreements were suspended, he said. The countries initially conducted trade under the General Agreement on Tariffs and Trade. After the World Trade Organisation replaced GATT, India granted MFN-status to Pakistan, he said. Following Pakistan's decision to grant MFN-status to India, both countries will dismantle non-tariff barriers and facilitate trade, Mahmood said. "In this regard, the two countries will hold a Commerce Secretary-level meeting on November 15," he said. India, meanwhile, has appreciated the Pak move and said it will also help improve political ties between the two neighbours. "We deeply appreciate this positive gesture that Pakistan has taken," India's Commerce and Industry Minister Anand Sharma said in New Delhi. Sharma spoke to his Pakistani counterpart Makhdoom Amin Fahim immediately after the decision taken by the Pakistani Cabinet. When asked whether the move would help improve political relationship between the countries, he said: "...It will be influencing definitely in positive manner. We need to sustain this in the coming months." Sharma said Makhdoom's September visit to India was a major step forward in this direction. PTI