EU welcomes India withdrawing objections to Pakistan trade concessions

ISLAMABAD: The EU has welcomed the outcome of the bilateral trade talks between India and Pakistan. It is very positive that India has decided to withdraw the objections to the World Trade Organisation waiver (WTO) sought by the EU for granting duty free access for certain goods from Pakistan to the EU market.

The Head of the European Union Delegation to Pakistan, Ambassador Lars-Gunnar Wigemark, said that the decision was also relevant in light of the renewed floods in the province of Sindh.

The WTO waiver was originally sought by the EU for unilateral trade concessions for Pakistan to provide relief after the devastating floods in 2010. The selected 75 products represent almost Ç 900 million worth of Pakistani exports to the EU, accounting for about 27% of the EU imports from Pakistan, which last year totalled Ç 3.3 billion.

Liberalizing these 75 tariff lines, of which one product line (ethanol) would be subject to an annual tariff rate quota of 80,000 tonnes based on past imports, would result in an estimated increase in EU imports from Pakistan of around Ç 100 million per year compared to 2009 statistics.

The EU will receive nearly Ç 80 million less in tariff revenues as a result of these trade concessions The EU will now re-launch the process in the WTO on the waiver.

Simultaneously, the EU will press ahead with its internal legislative process in the European Parliament (EP) and the Council, consisting of its Member States, on the proposed Regulation granting these trade preferences to Pakistan.

The next WTO Council for Trade in Goods is scheduled for 7 November. And a formal decision should be possible at the next WTO General Council in the beginning of December. If all goes well, the preferences would be in place by early 2012.

The EU is Pakistan’s largest trade partner with an annual trade volume of Ç 7.6 billion. The trade balance is already in favour of Pakistan, whose main export items to the EU are textiles and clothing products (more than 60% of exports to the EU).

Copyright PPI (Pakistan Press International), 2011