In spite of India having given MFN status to Pakistan, India's import from Pakistan is quite insignificant. However, it has made very extensive use of the alleged trade discriminatory policy of Pakistan for not giving reciprocal MFN status to India.
During the recent dialogue at the commerce secretaries meeting, Pakistan had drawn attention of its Indian counterpart to the fact that India has higher tariff and non-tariff barriers which must be brought in line with Pakistan as well as the WTO directive to enhance trade.
Pakistan would rather go for the preferential tariff agreement (PTA) with a reduction of tariff by India for greater market access under the PTA. It is more practical step for enhancing two way trade.
India has continued to oppose Pakistan's entry into the Indian Ocean Rim Association for Regional Co-operation because of the so-called discrimination of trade by withholding MFN status to India.
Since both the countries are now engaged in serious dialogue to reduce causes of the very meagre trade between the two which results in trade through illegal channels, it is high time that both the countries come to a more viable solution to take full advantage of the close geographical proximity and the "Confidence Building Measures" (CBM) being taken to reduce tension.
Meantime, India must withdraw its objection to Pakistan's membership of the IOR-ARC at the next meeting to be held in October 2005 at Tehran, Iran. Our foreign ministry has to make preparations by signing an "instrument of acceptance (instrument of accession)" and submitting if to the IOR-ARC Secretariat immediately as it is a pre-condition under the IOR-ARC rules to bring the membership application in the agenda for consideration in the next meeting.
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