In a surprising development, India has agreed to support EU’s trade concession package for Pakistan, something it had vetoed previously. They have termed it as one of the “big-ticket concessions”, in return of efforts for enhancement of bilateral trade between the two countries.
A statement issued by the commerce ministry in Islamabad said that Pakistan and India had agreed to work jointly to double their bilateral trade from the current $2.7 billion to around $6 billion per annum within three years.
The WTO waiver was originally sought by the EU for unilateral trade concessions for Pakistan to provide relief after last year’s devastating floods. The selected 75 products represent almost 900 million euros worth of Pakistani exports to the EU, accounting for about 27 per cent of the EU imports from Pakistan, which last year totalled €3.3 billion. The selected products range from certain food items, along with cotton, leather, apparel and other textile products. The boost from the trade package to our exports is estimated to be in the region of €900 million (~$1.2 Billion).
Currently, Pakistan is the net importer in overall bilateral trade between Pakistan and India. Pakistan’s exports to India currently stand at $286 Million for FY2011, while the latter’s amount to $1.445 Billion. That being said, the removal of many non-trade barriers and embargoes of various items will help swell Pakistan’s export figure, and while we are an importing nation, regional proximity could reduce cost of many major import items.
Is India’s “big ticket concession” in return for bilateral trade enhancement a suitable trade-off?
Would Pakistan’s local industries be negatively affected by the flood of cheaper goods from India, or will it stimulate competitiveness?
Lastly, can this development in trade be sustained and passed over in the political arena?
Dawn.com invites its readers to give their views and suggestions.