Jun. 19 – The Prime Minister of India Manmohan Singh dispatched a special envoy this month to meet with Pakistan’s Prime Minister Nawaz Sharif to discuss bilateral trade relations. During the meeting, both countries agreed on the importance of increased bilateral trade and committed to commence dialogues between the two countries’ respective commerce ministries.
According to the Pakistan High Commission, the two countries had a “useful exchange of views on a broad range of subjects pertaining to economic and trade cooperation between Pakistan and India.”
Pakistan’s High Commission added that it will continue to pursue a “qualitative improvement in relations” with India.
In addition, during the visit a Customs Cooperation Agreement was signed in a step towards addressing non-tariff barriers between the two countries. The Agreement on Mutual Recognition & Redressal was also signed which will help importers and exporters address business-related grievances. Furthermore, Pakistan increased its list of permissible items for import from India to 6,800, up from just 2,000 items previously.
The Trade Minister of the Pakistan High Commission also committed to granting India its Most Favored Nation (MFN) status during the meeting. The designation of this status will further strengthen economic ties between the two countries through increased cooperation and trade prioritization. India awarded Pakistan MFN status in 1996.
India and Pakistan have historically had strained trade relations due to political and territorial disputes. Recently, however, newly elected Pakistani Prime Minister Nawaz Sharif has decided to refocus the country’s attention on economic development.
Trade between the two nations has dramatically improved recently, with bilateral trade rising 21 percent to US$2.4 billion last year. In that same period, exports from India to Pakistan grew 19 percent, and exports from Pakistan to India grew 28 percent.