India watching Pakistan's moves on Safta

India is closely watching if Pakistan meets its commitments under the South Asia Free Trade Agreement (Safta).

Minister of State for Commerce Jairam Ramesh today said the success of Safta would depend on Pakistan doing away with the "positive list" restrictions on movement of goods from India.

"On July 1, Pakistan will have to open up at Wagah. This will be a test of their commitment to the agreement. The moment they open up, India's competitiveness in items like tea will go up", he said.

In order to kickstart the agreement and boost trade, India is investing Rs 15-20 crore in improving infrastructure at Petrapol (for Bangladesh), Raxaul (for Nepal) and Atari (for Pakistan).

The minister said major changes had been made in rules governing the market and infrastructure assistance schemes for Indian exporters to help backward states like Bihar, Uttaranchal, Himachal Pradesh, Orissa and Chhattisgarh.

"Two-third assistance under government-funded schemes like Assistance to States for Infrastructure Development (ASIDE), Market Development Assistance (MDA) and Market Access Initiative (MAI) goes to Gujarat, Andhra Pradesh, Maharashtra, Karnataka and Tamil Nadu", he said.

This is because these schemes are performance-based. "The commerce ministry has decided that the criteria will be changed from performance to employment generation," the minister said.

The ministry is telling these backward states to come up with viable projects for availing the benefits. It will also release Rs 50 crre to Rs 75 crore for promoting agri export zones.