India to consider zero duty for Pakistani goods to boost trade relations

The government of India may consider granting entry into India to textiles and other goods from Pakistan at concessional or zero duty to boost trade relations, sources say. The concession could be similar to the one that has been offered to Bangladesh, they said.

While the government is hopeful of a positive signal from Pakistan at the time when the commerce secretaries meet between 14 November and18 November, India wants Pakistan to go beyond a positive list - negative list, suggesting that Pakistan follow the Safta principle of trade with a small sensitive list of items, which could be pruned over time.

A meeting of commerce ministers is, however, expected to be held around February in Islamabad, on the sidelines of the Safta meet.

Hina Rabbani Khar, the Pakistan foreign minister, last week indicated that MFN status for India, a long-standing Indian demand was on its way. According to officials, the positive signals were a pointer that both sides were prepared to keep trade on a separate negotiating track to improve ties.

In a bid to address Pakistani concerns over India using non-tariff barriers such as safety standards for cement, textiles and surgical instruments, an official spokesman said if cement met the prescribed norms, or if textiles products did not contain dyes that are banned in India, then there was no question of denying Pakistani goods, entry into India.

He said this had been conveyed to Pakistan.