Trade talks with Pakistan hit speed-breaker

After showing a promising beginning, talks between India and Pakistan on confidence-building measures (CBMs) to give a momentum to the trade have hit a roadblock as larger “political issues” have impacted the movement of negotiations and initiatives.

The slowdown in the momentum comes after the negotiators on both sides showed promise of taking ‘big steps’ to give a major fillip to trade on both sides, notwithstanding the differences on various other political and boundary issues. “Things have suddenly slowed down from the Pakistan side on the trade issues. Pakistan negotiators are on the same page as their Indian counterparts but it seems trade is being linked to progress on bigger issues such as Siachen and Sir Creek talks. It is unfortunate but true,” a senior official in the Commerce and Industry Ministry said here.

The case in point is the last-minute decision of the Pakistan side not to sign the liberal visa regime agreement in Islamabad last month after everything had been tied up for such an event. “Pakistan is yet to revert back to us for Commerce Secretary-level talks despite repeated reminders. There has been little progress from their side on expanding the list of items to be traded through the land route despite promises to do it in May itself. The experts’ groups on electricity and petroleum are yet to meet, leading to re-scheduling of meetings twice in the last two months. Some tariff barriers need to be tuned in line with the SAFTA (South Asian Free Trade Area) agreement. It is a disappointing situation,” the official said.

Officials said India had removed all restrictions on imports from Pakistan but the same was not being done on the other side of the border. “We need to finish negotiations and finalise the expanded list of items to be traded through the land route immediately. Then, we have to prune the negative list according to the SAFTA agreement requirement to give a new turn to bilateral trade. We are still waiting for a response from the Pakistan side,” the Commerce Ministry official said.

Experts’ groups of India and Pakistan on electricity and petroleum were expected to meeting early this month to work out the modalities for exporting power, petrol, diesel and petrochemicals to Pakistan. However, the meetings are still to happen. The progress on opening up of new land routes for trade in Rajasthan and Punjab has also been disappointing.

Both sides have also agreed that software body National Association of Software and Service Companies (Nasscom) would co-ordinate with Pakistan Software Export Development Board to facilitate a road show for Pakistani IT companies in Bangalore, Hyderabad and other Indian IT hubs for extending co-operation in this sector. However, progress on this front has also been also slow and painful.