LAHORE: In what will be seen as a retreat from its recent stance, the government has linked trade liberalisation with India with the resumption of the suspended composite dialogue and progress in overall bilateral relationship.

Speaking to Dawn after inaugurating the second three-day India Show here on Friday, Commerce Minister Khurram Dastgir Khan sounded upbeat about the future of the trade relationships but said “trade talks cannot be held in a void”.

“The fact is that the composite dialogue remains suspended as we speak here now, on Valentine’s Day. Improvement in bilateral trade relations is not possible without progress in overall relations between the two countries,” he said.

He said his ministry was discussing the issue of granting non-discriminatory market access (NDMA) to Indian exports as an alternative to the politically controversial most-favoured nation (MFN) status and liberalise trade through the Wagah-Attari land route.

The government has consistently been saying that it wants to normalise trade relations with India.

It has also hinted at increasing from the current 137 number of items that can be traded via Wagah.

The minister’s statements over the past two months favouring early normalisation of trade had raised hopes of the Indian industry and its businessmen were expecting an announcement to this effect at the India Show.

Indian Trade Minister Anand Sharma had announced that he would visit Lahore to jointly inaugurate the show. But lack of substantive progress on the issue made him cancel his visit.

According to observers, the government’s unwillingness to move forward in this regard has also jeopardised Prime Minister Manmohan Singh’s much-awaited visit to Pakistan. Mr Singh had expressed desire to visit Pakistan before India goes to elections this summer.

Addressing the opening ceremony, the commerce minister said Pakistan was dreaming of peace with India with its eyes open.

“It means that we want better relations and recognise the issues that divide us.”

He said trade could help improve relations in other spheres as well, adding that last year’s elections had proved that anti-India sentiment was no longer a political issue in Pakistan.

“Things have improved in India as well, but not entirely. Restrictive visa regime remains the biggest barrier impeding bilateral trade. It is stopping people from both countries from exploring business opportunities. Some progress was made on this issue in the past but was not fully implemented.”

The minister said he had told Mr Singh during his visit to Delhi that the commerce ministries could push trade forward only to a certain extent. “When other ministries get involved we hit the wall.”

He said it would have given him immense pleasure had Mr Sharma led the Indian delegation participating in the show and inaugurated it along with him.

Indian High Commissioner T.C.A. Raghavan was also present along with a large delegation of businessmen from his country.