The two countries will seek the removal of trade barriers at the secretary-level discussions scheduled this month.
The Federation of Indian Chambers of Commerce and Industry (Ficci) and the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) are looking to strengthen ties to boost co-operation in the SME sector between the two countries. They have also sought the removal of trade barriers at the secretary-level discussions scheduled this month.
“We are planning to send a delegation of 60 to 70 people next year, according to the invitation from FPCCI. This will be along with Commerce Minister Anand Sharma’s visit to Pakistan. Our main focus is on SMEs, as the sector contributes the majority of trade between the two countries, and through which business can be doubled in the coming years,” said Ambika Sharma, deputy secretary general and head of Ficci’s international operations.
The areas in which the chambers want to improve co-operation are cement, textiles, the trade in surgical instruments, pharmaceuticals, automobile component manufacturing, agricultural products, leather and light engineering equipment. Currently, the trade between India and Pakistan is about $2.7 billion a year, and experts say more than 70 per cent of this is contributed by SMEs.
“Both Ficci and FPCCI believe that there needs to be confidence building between the business communities of the two countries. If both governments can bring some changes as far as trade and visa policies are concerned, trade can be more than doubled from $2.7 billion to $6 billion in the next two years,” said Haji Ghulam Ali, president of FPCCI.
Ali added that both nations should explore possibilities of expanding trade through the rail and sea routes rather than just concentrating on the overland trade. The United Arab Emirates, the US, the UK and Switzerland are the four major foreign investors in Pakistan, and the chambers are looking to give Indian investments a push.
More From This Section
“The current unofficial trade between India and Pakistan through third countries is around $10 billion. If we can remove trade barriers, this quantity of extra revenue will come through bilateral trade only,” said Manish Mohan, additional director and head of Ficci’s South Asia operations. Expansion of trade through the Attari-Wagah border is also among the demands.
According to the apex business bodies, restrictions on the positive list, through which only 1,938 items can be imported from India, should be relaxed. “Other items are totally banned. The Pakistan government should enlarge this list, so that SMEs can be involved in more business,” he said. Ficci also favours an investment promotion and protection treaty between the two countries.
“I hope the secretary-level talks in November will turn out to be a platform for our plans to enter into a bigger tie-up in the SME sector,” Ali said.
The two chambers had together formed the India-Pakistan Chamber of Commerce and Industry (IPCCI) in 1999 to promote trade co-operation. In September this year, Ficci hosted a 78-member business delegation from Pakistan, led by its commerce minister, in Mumbai and New Delhi.
According to data compiled by India’s ministry of commerce and industry, the major export items from India to Pakistan are sugar and sugar confectionery ($654 million) and cotton ($401.82 million). Ali, who is also a senator, believes that trade has increased over the years due to lobbying by both the bodies.
“In 2000, bilateral trade was $200 million, and it has zoomed to almost $3 billion. Moreover, the positive list included only 600 items then, and it is 1,938 now. It is mainly due to our efforts and the increased focus on small enterprises,” Mohan said.