The central banks of India and Pakistan are in advanced talks for opening bank branches in Karachi and Mumbai as part of measures to normalise bilateral trade, a media report said today.
"The Indian High Commissioner (T C A Raghavan) disclosed that working for opening of bank branches is in an advanced stage and it would be a great achievement for both the countries because this would allow currency swap against their import and export trade," the Dawn reported.
Raghavan made the remarks while addressing business and industry leaders at a luncheon meeting organised by the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) in Karachi yesterday.
Commerce Minister Khurram Dastagir Khan had told PTI in an interview last month that both countries are working on allowing three banks each to set up branches across the border to help improve trade relations.
The State Bank of Pakistan had recently written to the Reserve Bank of India (RBI) that three banks would like to open their branches in India.
While public sector banks State Bank of India and Bank of India had their branches in Karachi and Lahore till 1965, they were forced to close down following the war between the two countries that year.
Raghavan said there is a strong demand from the trade community and the general public of both the countries for opening of consulates at Karachi and Mumbai.
He was quoted as saying he hoped "this dream would also come true in the near future on getting approval from both the governments of India and Pakistan.".
According to official figures, bilateral trade recorded a net increase of $410 million from April 2012 to March 2013, up by 20 per cent.
Pakistan's exports to India grew 28% while Indian exports to Pakistan increased 19% during this period.
Official trade between India and Pakistan has crossed USD 2.6 billion. India's exports to Pakistan are worth $2.1 billion while Pakistan's exports to India value at $500 million.
Talking about visa issues, Raghavan said India has eased its visa conditions and it is processing more multiple-entry visas for Pakistani businessmen.
