Pakistan postpones special trade status for India

Pakistan PM says special trading status will be postponed because of domestic opposition.

Pakistan postpones special trade status for India

World Bulletin / News Desk

Pakistan on Monday postponed a much-publicized decision to grant India special trade status by the end of March.

Pakistan's decision to give India "Most Favored Nation" (MFN) status was connected to a policy of improving trade and business ties with its neighbors.

“The decision to grant MFN status to India has been postponed due to lack of consensus on the issue,” Prime Minister Nawaz Sharif told reporters at The Hague in the Netherlands, where he is attending a two-day nuclear summit.

“We have deferred the decision also because of the forthcoming elections in India. We do not want to favor one single political party in India,” said Sharif. “I have directed my team to talk to all the stakeholders, and develop a consensus on the matter," said Sharif.

He did not elaborate on who was unhappy with the decision but it is generally believed that the country’s powerful army and right-wing parties are uncomfortable with such close relations.

Right-wing leaders, including the chief of Jamat-ud-Daw’ah, Hafiz Mohammad Saeed, had already openly warned Sharif that the nation would not accept this “unilateral favor” to India who “has let loose a reign of terror against Kashmiris.”

The two regional rivals have fought two full-fledged wars – in 1948 and 1965 – and a three-week long skirmish in Kargil in 1999, over Kashmir.

The long-discussed issue of Most Favored Nation status for India has been discussed for 15 years but a succession of governments, since Sharif himself was ousted from power in 1999, have failed to succeed in granting it for a variety of reasons - including the 2008 Mumbai attacks.

Sharif, who is among the country’s top-ten businessmen, has always been eager to extend MFN status to India and is accused by his political rivals of wanting the agreement because it would benefit his sugar and steel businesses.

The agreement would give Pakistan access to the Indian market of over one billion people, which would could help its current exports surge from US$350 million to US$1 billion annually, within a year.

However, critics suggests the huge Indian market will engulf Pakistan’s, which is already struggling due to a simmering energy crisis, trouble with law and order and relatively costly manpower. 

Last Mod: 24 Mart 2014, 17:34
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