Indian Non-Tariff Barriers: Pakistan Demands India to Sign Four Agreements to Address NTBs .

ISLAMABAD: Secretary Commerce Zafar Mehmood here on Thursday announced that India has no Pakistan specific tariff and non-tariff barriers, however, for removal of general tariff and non-tariff barriers faced by our exporters, Pakistan has demanded India to sign four agreements.

To gain level playing trade opportunities after trade normalisation with India, Pakistan has asked for signing of these agreements: Customs Cooperation Agreement, Mutual Recognition Agreement, Redressal of Grievances Agreement and Preferential Tariff under SAFTA arrangement, he informed the Senate Standing Committee on Commerce which met in the parliament house with Senator Ilyas Bilour.

“We have asked Indian side to get signing approval of such agreements from their relevant ministries or departments before the arrival of their commerce minister’s arrival in Pakistan by mid February 2012,” Secretary Commerce added.

In his first ever briefing to parliamentary committee, Secretary Commerce explained that there are technical, environmental and public health related additional measures are in place in India like upward revision in valuation of goods imported from Pakistan by Indian Customs, lengthy and costly and short period certification of standards by Indian authorities, composite tariffs charged by Indian customs in addition to normal import duty, lengthy process of checking of samples and ingredients of final product.

He informed that the said four agreements that Pakistan has demanded India to sign would help remove difficulties faced by Pakistan exporters while exporting to India. These agreements would bind both the countries to accept certification of national laboratories, accept valuation declared by exporters, removal of composite duties and other difficulties.

He informed that Pakistan is going to shift its trading arrangement with India from positive list to negative list, under trade liberalisation arrangement and so far local industries have proposed less than 1000 items for placement in negative list. He, however, explained that many items proposed by local industries need to be excluded from proposed negative list as few of such items are not even imported from India or already in positive list of Pakistan which stands at 1958 at present.

He categorically said that there is no international pressure on Pakistan to give MFN status to India and also mentioned that there is trust deficit between the two countries as well as within the local industry that their interest might not be safeguarded. India had demanded Pakistan to give MFN status with a single stroke of pen, however, Ministry of Commerce would ensure sequencing of events before it to ensure proper safeguards to them. When Ministry of Commerce would approach federal Cabinet in February 2012, we would ensure transparent presentation so as to reach at final decision.

When asked about would Pakistan delay implementation of negative list beyond December 31, 2012, Secretary Commerce said that it’s the federal cabinet to decide this.

Secretary Commerce assured the committee that that before completion of trade liberalization with India as per Most Favoured Nation Status, an effective level of protection would be ensured to safe guard the local industries, as well as local industries would be able to use trade defence instruments like anti-dumping duty, countervailing duty and safeguard duty against any trade threat.

He informed the committee that trade on non-discriminatory principles means MFN status and federal cabinet has empowered Ministry of Commerce to normalize trade relations with India on non-discrimination basis which means MFN status.

He informed that India had given MFN status to Pakistan in 1996 and Pakistan has so far not granted this status to India. India had not challenged it before World Trade Organisation, however, have been raising this issue with Pakistan during bilateral trade talks. Giving MFN status to India would mean meeting one of the international trade obligations, what we had agreed while entering in to WTO ambit.

He informed that at present many products are coming to Pakistan from India indirectly after changing on packing and brand names in Dubai or other countries and such arrangement is costing Pakistan additional import cost of $300 million to $700 million annually. After trade normalization local industry would not be paying this huge additional import cost and would be competitive in importing such machinery or raw materials in less cost against existing cost.

Secretary was of the view that at present balance of trade is in favour of India and after trade liberalization definitely this balance would remain in favour of India, however, Pakistan’s local industry would have market access to over a billion population market.

He mentioned that it is not the Pakistani industry alone, but Indian industry also has apprehensions about their existence and with the normalization of trade there would be big opportunities for Pakistani industries to make their place in Indian markets.

To make aware the local industry about the challenges and opportunities before us while normalizing trade with India a mega awareness campaign would soon be started and seminars would be conducted, electronic and print media would be used a special pamphlet would also be published in this regard.

Senator Ishaq Dar, after the briefing, urged Ministry of Commerce to also look in to the issue of subsidy that India provides it’s exporters would hurt local industry and special care should be observed while negotiating new trading arrangement with India. He especially mentioned that cost of production in Pakistan is much higher than India as the prices of power, gas are higher in Pakistan, interest rates are high, currency is continuously depreciating.

Senator Haroon Akhtar Khan was of the view that normalization of trade with India would greatly benefit India compared with Pakistan. He questioned that while setting aside other political disputes with India why we are going for this facility to India. He also expressed apprehensions that Pakistan’s trade deficit would shoot up many folds are MFN status to India and local industries would be facing tough competition against Indian subsidized products.

Senator Abdul Razzaq, was of the view that trade with India is benefiting India despite they have given MFN status to Pakistan and when we are going to normalize our trade with it Indian products would flood our markets and hurt local industries.

Source : dailytimes.com.pk