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MFN status for India

Published Apr 29, 2011 07:30pm

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PAKISTAN has expressed its intention to extend the Most Favoured Nation status to India. At the end of a Pakistan-India meeting in Bhurban, Pakistan’s commerce secretary “assured” the Indians of the coveted tag by October this year. There appears to be no mention of an Indian wish for a transit route to Afghanistan and beyond, and Pakistan says it did not raise the issue of Indian opposition to the EU decision to provide duty-free access to Pakistani goods. This brings out the truly bilateral nature of the two-day talks. The details say Islamabad has conditioned the grant of the preferential treaty on the removal of non-tariff barriers by India. Secretary Zafar Mahmood said on Thursday that Pakistani businessmen are not opposed to the grant of the MFN status, that, indeed, they desired it to be conferred on India. We will learn more between now and October as the matter trickles down from the cool Bhurbhan clime to the plains where sentiments are easily hurt and the mere notion of a ‘favour’ to India can raise eyebrows. Politics may soon mix with trade, and Kashmir, which is much more than a political issue and involves human rights, will interfere.

Those who have followed Pakistan-India contacts have often been frustrated by situations resulting from the resort to ready terminology. In search of a relationship between the two countries, they would have preferred innovation. The MFN status has a tendency to draw extreme reactions worldwide. There is no bigger example of such emotions than the Sino-American case. China got the much desired preferential treatment from the US, to the chagrin of American manufacturers who demanded a level playing field. But then it appears that commerce experts the world over cannot do without landmarks.

Thus the MFN status is the milestone the current Pakistani and Indian negotiators are looking for right now, and they will claim they have earned it through assiduous work and breaking old taboos. The two countries have taken a long time to have an earnest discussion on trading items such as electricity and petroleum products. They promise to do so in the coming months. Advancing to the MFN stage may, to an extent, depend on the progress made in these areas which have a special significance for Pakistan. Pakistanis will also be keeping a close eye on how many non-tariff barriers India can remove. An official count in 2007 suggested that there were 27 such barriers, including an Indian reluctance to give visas to Pakistani businessmen. To end suspicions and for building confidence among businessmen these halters must go.

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