 "Will Pakistan now grant 'most favoured' status to India?")
Prime Minister Narendra Modi on Friday made a sudden first trip to Lahore on the occasion of the birthday of his Pakistani counterpart Nawaz Sharif. Modi tweeted his plans of a quick stopover in Lahore on his way back from Kabul on Friday afternoon, which took the media by surprise.
The previous visit to Pakistan by an Indian prime minister was more than a decade ago in 2004 by Atal Bihari Vajpayee. Friday was also Vajpayee's birthday.
According to the ministry of commerce, India's trade with Pakistan was worth $2.35 billion in 2014-15. This represented only 0.3 per cent of India's total international trade.
Exports from India of $1.85 billion 79 percent of the trades. Major export items include plastic articles, rubber, edible vegetables and organic chemicals. Fruits and nuts, cotton, salt, sulphur, earth and stones, and mineral oil constitute the bulk of goods imported from Pakistan.
Bilateral trade grew in the five years till 2014-15, when it shrank by 12.8 per cent from the year before. Also, in 2014-15, while Indian exports dipped by 18.3 per cent, imports from Pakistan rose by 16.5 per cent.
The issue of Pakistan not granting India Most Favoured Nation (MFN) status dominates trade negotiations. The MFN principle was part of the General Agreement on Tariffs and Trade (GATT), now applicable to all members of the World Trade Organisation (WTO). It prevents countries from discriminating among trading partners.
All member-countries must treat all other members equally as most favoured trading partners. If a country increases benefits to one trading partner, it has to offer the same treatment to all other WTO members. India accorded MFN status to Pakistan in 1996, when both became members of the WTO.
Commerce Miniser Nirmala Sitharaman recently told Parliament that it had been agreed during the seventh round of talks on trade and economic cooperation between commerce secretaries in September 2012 that Pakistan would transition fully to MFN (non-discriminatory) status for India by December 2012.
India allows all goods to be exported to and imported from Pakistan, except for a list of items India has banned from being exported to all countries.
Earlier this month, External Affairs Minister Sushma Swaraj had reached out to Pakistan, calling for stronger business ties while atending the Heart of Asia multilateral conference in Islamabad.
A new trading relationship has the potential to open the Afghan and the Central Asian markets for Indian goods and benefit the region. India has tendered a request to join the Afghanistan-Pakistan Trade and Transit Agreement.
In January, India had also provided Afghanistan duty-free access to its market under the South Asian Free Trade Area (Safta) agreement. Afghan trucks are allowed to unload goods at the integrated checkpost at Attari, one km from the international border at Wagah.
From January 2013, Pakistan and India being non-least developed country members of the SAFTA have reduced their tariffs across nearly 5,000 lines in the zero-five per cent range.
Relations between the two countries deteriorated shortly after Modi was sworn in as prime minister in June 2014.
While there had been hopes of a constructive dialogue, India has accused of Islamabad of not doing enough to tackle terrorism.
The Kashmir issue, which threatens to derail all talks, still looms. A meeting of national security advisers was cancelled in August when Pakistan insisted Kashmir be on the agenda.
Modi had met Sharif on the sidelines of the UN Climate Change conference in Paris and agreed to begin a new dialogue. Following that, national security advisers from both countries had met in Bangkok.
Modi had arrived in Kabul on Friday, where he inaugurated the new parliament building, a project initiated by the Indian government in 2007 to help rebuild the war-torn country.
The previous visit to Pakistan by an Indian prime minister was more than a decade ago in 2004 by Atal Bihari Vajpayee. Friday was also Vajpayee's birthday.
According to the ministry of commerce, India's trade with Pakistan was worth $2.35 billion in 2014-15. This represented only 0.3 per cent of India's total international trade.
Exports from India of $1.85 billion 79 percent of the trades. Major export items include plastic articles, rubber, edible vegetables and organic chemicals. Fruits and nuts, cotton, salt, sulphur, earth and stones, and mineral oil constitute the bulk of goods imported from Pakistan.
Bilateral trade grew in the five years till 2014-15, when it shrank by 12.8 per cent from the year before. Also, in 2014-15, while Indian exports dipped by 18.3 per cent, imports from Pakistan rose by 16.5 per cent.
The issue of Pakistan not granting India Most Favoured Nation (MFN) status dominates trade negotiations. The MFN principle was part of the General Agreement on Tariffs and Trade (GATT), now applicable to all members of the World Trade Organisation (WTO). It prevents countries from discriminating among trading partners.
All member-countries must treat all other members equally as most favoured trading partners. If a country increases benefits to one trading partner, it has to offer the same treatment to all other WTO members. India accorded MFN status to Pakistan in 1996, when both became members of the WTO.
Commerce Miniser Nirmala Sitharaman recently told Parliament that it had been agreed during the seventh round of talks on trade and economic cooperation between commerce secretaries in September 2012 that Pakistan would transition fully to MFN (non-discriminatory) status for India by December 2012.
India allows all goods to be exported to and imported from Pakistan, except for a list of items India has banned from being exported to all countries.
Earlier this month, External Affairs Minister Sushma Swaraj had reached out to Pakistan, calling for stronger business ties while atending the Heart of Asia multilateral conference in Islamabad.
A new trading relationship has the potential to open the Afghan and the Central Asian markets for Indian goods and benefit the region. India has tendered a request to join the Afghanistan-Pakistan Trade and Transit Agreement.
In January, India had also provided Afghanistan duty-free access to its market under the South Asian Free Trade Area (Safta) agreement. Afghan trucks are allowed to unload goods at the integrated checkpost at Attari, one km from the international border at Wagah.
From January 2013, Pakistan and India being non-least developed country members of the SAFTA have reduced their tariffs across nearly 5,000 lines in the zero-five per cent range.
Relations between the two countries deteriorated shortly after Modi was sworn in as prime minister in June 2014.
While there had been hopes of a constructive dialogue, India has accused of Islamabad of not doing enough to tackle terrorism.
The Kashmir issue, which threatens to derail all talks, still looms. A meeting of national security advisers was cancelled in August when Pakistan insisted Kashmir be on the agenda.
Modi had met Sharif on the sidelines of the UN Climate Change conference in Paris and agreed to begin a new dialogue. Following that, national security advisers from both countries had met in Bangkok.
Modi had arrived in Kabul on Friday, where he inaugurated the new parliament building, a project initiated by the Indian government in 2007 to help rebuild the war-torn country.