Pak Industry Ministry recommends MFN status for India

ISLAMABAD: Notwithstanding the Pakistan Commerce Ministry's objections to signing SAFTA which would entail free trade with India, the Ministry of Industries has recommended granting of MFN status to New Delhi, saying liberalisation of trade would benefit Islamabad.
Pakistan's Ministry of Industries, Production and Special Initiatives has said in a report that liberalising trade with India will lower prices for domestic consumers and generate greater revenue for the government through taxes, Online news agency reported.
The move will also help reduce illegal trade between the two countries, give greater market access to Pakistani products and lower production costs due to availability of cheap imports, it said.
"Trade can be liberalised bilaterally through MFN-based trade or under the formation of SAFTA. Granting MFN status to India will place India at par with Pakistan's trading partner," the report said.
Pakistan's Commerce Ministry had said that signing SAFTA or granting MFN should be done only if there was progress on the Kashmir issue. The Commerce Ministry's stand reportedly made Pakistan government put off the ratification of the SAFTA draft agreement.
SAFTA "would discriminate against the rest of the world in favour of India, leading to significant trade
diversion. To gain the maximum benefit from trade liberalisation and to prepare for SAFTA, Pakistan should grant MFN status to India," the Industries Ministry said.
The Ministry also recommended that Pakistan negotiate strategic partnerships with Indian firms, lower barriers to investment by removing protection for local producers and develop capacity building to prevent dumping.