ISLAMABAD, March 1: Pakistan on Thursday linked progress on trade liberalisation with India to removal of all non-tariff barriers (NTBs) saying Islamabad is ready for bilateral consultation with New Delhi on these issues under South Asia Free Trade Agreement (Safta).Addressing a press conference here Commerce Minister Humayun Akhtar Khan said Pakistan believed that due to these NTBs and para-tariffs products of Pakistani interest could not enter the highly protected Indian market.

When asked if India agreed to remove NTBs whether Pakistan would reciprocate with granting MFN status to New Delhi, the commerce minister replied both countries were engaged in a dialogue on all other issues too as part of the composite dialogue process.

However, for the first time the minister did not mention that improvement of trade relations with India would be in tandem with progress on other issues, particularly the core issue of Kashmir.

He said India will have to remove non-tariff barriers either for all countries or bilaterally for Pakistan, which restrict market access in India. He said the other Saarc countries also submitted list of NTBs restricting trade with India to the Saarc secretariat.

Mr Khan said Pakistan wanted that the entire market access issue should be discussed and resolved by the Safta Ministerial Conference (SMC) but India, on the other hand, wanted to de-link the two issues, by taking up one issue of maintenance of positive list of import by Pakistan in the SMC meeting while leaving the issue of non-tariff barriers and para-tariffs maintained by India to a sub-group of the committee of experts at the technical level.

On this issue, the minister said, Pakistan and India could not reach an agreement. After this development, the Indian minister gave a statement that New Delhi would review its tariff concession to Pakistan and that was on record.

"We have the transcript of the Safta council meeting. I know that there are certain denials. We stand by our statement," the minister said in reply to a question.

He said Pakistan had fully complied with the Safta, which is also established from the fact that all the provisions of the agreement would be followed in letter and spirit. In case India has a different view, the agreement provides a dispute settlement mechanism in Article 20 of the agreement. This process begins with bilateral consultations, consideration by committee of experts and final disposal in appeal by the SMC.

Referring to the Indian threat of withdrawal of concessions he said, "If this happens, it would be a serious blow to Safta, and it will be a step Pakistan would deeply regret," the minister said and added, "I hope India will not take any drastic steps, which will reverse Safta."

Pakistan has assured the SMC that it will not go through any review with regard to concessions given to India, and will continue to follow all tariff reductions under the trade liberalisation programme in future, irrespective of any Indian action, he added.India’s exports to Pakistan will cross $1 billion mark during the current fiscal year, while Pakistan’s exports to India would reach a mere $350 million by end June 2007.

A fact sheet issued after the press conference said that just after issuance of notification on July 1, 2006, to give tariff concessions under the Safta, India agitated that tariff concessions offered by Pakistan were subject to the Import Policy Order and, therefore, were against the spirit of the agreement.

Pakistan contested the Indian point of view during the SMC. The commerce ministry rebutted the Indian point of view on grounds that the Import Policy regulations are provided in the import regimes of all Saarc countries.

Pakistan had only indicted this requirement in its notification to make it transparent. The fact, that such conditions were not mentioned by other Saarc countries in their respective notifications, did not imply that they had waived such conditions for trade within the region.