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Pakistan, India ink key accords in trade, power sectors

Pakistan and India have agreed to scale down Islamabad’s specific restrictive trade list by 30 percent for removing non tariff barriers, explored options to set up 2,000MW power plant by an Indian firm and selling 5 mmcfd gas per day to Pakistan.

India also offered to provide 100 locomotives to Pakistan during the two-day commerce secretary-level talks that concluded here on Friday. Both sides also signed three agreements on customs cooperation, certification issues and the resolution of trade grievances.

However, according to the joint declaration, India will reduce the list by 30 percent only after Pakistan notifies removal of all restrictions on trade by Wagah-Attari land route.

In a major breakthrough, significant progress has been achieved on key issues including trade through land route, connecting both the capitals via air, removal of non-trade barriers (NTBs) and cooperation in the telecommunication sector during the conclusion of seventh round of bilateral talks.

Both sides agreed that the next round would be held in New Delhi by April next year.The commerce secretaries of both countries also inked joint declaration for setting up roadmap for implementation of decisions taken during the two days parleys.

“The talks are progressing in accordance with our needs and programme, mainly manifested by gradual removal of bottlenecks,” Minister for Commerce Makhdoom Amin Fahim said, who was present for witnessing the signing ceremony on the three agreements.

Bharat Heavy Electrical Limited offered to set up 500 to 2,000MW power plants in Pakistan as per the country’s requirements and the stakeholders from both the sides will now sit together to explore its possibility.

Addressing a joint press conference on the occasion, Commerce Secretary Munir Qureshi said that India agreed to provide level playing field to Pakistani exporters by bringing down its sensitive list maintained under South Asia Free Trade Agreement (Safta) by 30 percent.

The decision to this effect, he said, would be implemented before end of this year, paving the way for giving Most Favoured Nation status to New Delhi. He stressed that India will exclude the restrictive items in consultation with Pakistan.

India has maintained a 614-item list under Safta and it will bring down the list to only 100 items by April next year. Pakistan has also maintained a sensitive list comprising 936 tariff lines, which will be brought down to 100 in next five years.

India Commerce Secretary SR Rao said, “India has been assured that by end of October Pakistan would significantly expand the list of the goods that could be traded through Wagah border”. Both the countries have also decided that Wagah route will remain operational for seven days a week as against six-day a week current operations.

Both the sides emphasised to further strengthen infrastructure on both sides of the border for better road access. Both the sides also agreed that a meeting of Joint Working Group will be held in end October in New Delhi to review the possibility of opening Munabhao-Khokhrapar land route.

While responding to a question regarding India’s earlier offer to sell 500MW electricity, SR Rao said for setting up a 500MW grid station at least one and half years were required. He said for immediate energy trade a technical group would review the possibility to exchange 220KV transmission line in next six months.

India also showed willingness to sell 5 mmcfd gas per day to Pakistan. It extended its cooperation in the areas of wind and solar energy.

India also made an offer to meet the requirements of Pakistan Railways up to 100 locomotives. The issue of availability of sufficient number of rakes for interchange was also highlighted by Pakistan. Islamabad also asked India to allow High Capacity Wagon, which carries three times more load than regular wagons.

Connecting both capitals via air is very important for normalisation of relations. A six-month timeline has been set up for opening up and connecting Islamabad-New Delhi route.For banking channels the banking regulators will exchange the list of the branches to be opened in respective countries in next two months.

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