NEW DELHI: India on Thursday welcomed Pakistan’s decision to phase out major restrictions on Indian imports by the end of this year, a move to normalise trade ties between the neighbours.

Foreign Minister S.M. Krishna thanked Pakistan for deciding to gradually scrap the ‘negative list’ that prevents the export of hundreds of items from India.

“Pakistan is moving in the right direction in terms of bringing economic content into the political relationship,” Mr Krishna told reporters.

“This would certainly help strengthen our bilateral ties.”

Pakistan has decided in principle to phase out the negative list between the two countries by Dec 31, 2012, which will complete the trade normalisation process.

Direct trade between India and Pakistan currently constitutes less than 1 per cent of their respective global trade. India exported goods worth $2.33 billion to Pakistan last year while its imports were $330 million.

In 1996, India granted Pakistan ‘most preferred nation’ status which is intended to remove discriminatory higher pricing and duty tariffs.

Pakistan agreed in principle to grant a similar status to India last year, paving the way for a radical change.—AFP