Pakistan on Sunday "deplored" India's decision to suspend all cross LoC trade, claiming New Delhi has taken this action unilaterally on the basis of "groundless accusations".
It has also urged the Indian government to "resolve differences through constructive engagement".
"Pakistan deplores the unilateral Indian decision to suspend cross LoC trade and rejects the allegations regarding its misuse. The Indian action is based on groundless accusations that this mechanism is being used for smuggling, narcotics, fake currency and terrorism," read a statement released by Pakistan Foreign Ministry.
"We urge India to refrain from taking unilateral measures and resolve differences through constructive engagement with a view to transitioning from conflict to cooperation," the statement added.
This comes days after the Ministry of Home Affairs (MHA) issued orders to suspend the cross LoC trade in Jammu-Kashmir with effect from April 19.
MHA had said in a statement that this action has been taken as the Government of India has been receiving reports that the cross LoC trade routes are being misused by Pakistan based elements for funnelling illegal weapons, narcotics, and fake currency.
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During the ongoing investigations of certain cases by the National Investigative Agency, it has been brought out that a significant number of trading concerns engaged in LoC trade are being operated by persons closely associated with banned terrorist organisations involved in fuelling terrorism/separatism. Investigations have further revealed that some individuals, who have crossed over to Pakistan, and joined militant organisations have opened trading firms in Pakistan. These trading firms are under the control of militant organisations and are engaged in LoC trade.
Calling for Confidence Building Measures (CBMs), the Pakistan Foreign Ministry said, "In our view, there are better ways of dealing with issues relating to implementation, if any, than resorting to unilateral suspension of important CBMs.