New Delhi: India has just upped the ante in its frosty trade relationship with Pakistan.
The country has submitted a list of trade barriers posed by Pakistan on exports from India to the South Asia Association for Regional Cooperation (Saarc), the body overseeing implementation of the free trade pact in the region.
The Indian team was responding to similar charges from across the border and it comes just ahead of the next South Asia Free Trade Area (Safta) ministerial council meeting on 26 February in Kathmandu.
The meeting, which is likely to be attended by commerce and industry minister Kamal Nath, is expected to discuss the non-implementation of Safta by Pakistan with regard to India. Though Safta came into effect in January 2006, Pakistan has restricted India’s exports to just 1,075 items. All other items are in the negative list.
This would be the second ministerial meeting since the implementation of Safta. The meeting was originally scheduled to be held in Dhaka in October last year, but was postponed.
Pakistan has on several occasions, including bilateral meetings, raised the issue of trade barriers imposed by New Delhi. The list includes the requirement to obtain an annual certification from the Bureau of Indian Standards for electronic and leather products, import permits on poultry and dairy product exports, 4% countervailing duty on all imports in addition to the import duty and stringent requirements of registration of drugs with the Central Drug Standard Control Organisation. Islamabad contends that these measures add to the cost and impact the competitiveness of their exports to India.
The government has submitted a list of 22 non-tariff barriers faced by Indian exports to Pakistan. They include limiting the imports to just 1,075 items, which is violative of the Safta agreement. Some of the other barriers include not allowing screening of Indian films, disallowing transit facilities for exports from India to Afghanistan through Pakistan and disallowing land route for Indian cotton exports. India has also pointed out that Pakistan only allows onions, potatoes, tomatoes, garlic and livestock to be imported from India through the Wagah border.
Bilateral trade between India and Pakistan is estimated at around $1 billion (Rs4,400 crore) while informal trade is pegged at close to $2 billion (Rs8,800 crore).
“Each Saarc member country is under the Safta agreement required to submit the list of their non-tariff barriers faced by them in other countries in the region. The Safta ministerial council will now deliberate on these and firm a view on the future course of action,” a government official said.