Pakistan has demanded special protection for its agriculture, automobile and pharmaceutical sectors before it agrees to extend most favoured nation (MFN) status to India by removing ban on all imports.

“Our industry is apprehensive that without adequate protection it will be swamped by cheap imports from India as agriculture produce, automobile and pharmaceuticals are heavily subsidised by New Delhi,” Naeem Anwar, Minister Trade, Pakistan High Commission in India, told BusinessLine .

Pakistan feels that the safeguard mechanism against surge in imports under the World Trade Organisation framework is too unwieldy for a small country to use effectively. “We have asked India to get into a bilateral safeguard mechanism with us that will give adequate protection to our sensitive industries,” Anwar added.

Various safeguard mechanisms, such as one that would enable Pakistan to stop imports of a particular commodity as soon as it crossed a specific threshold, were being examined by both sides, he said.

However, Anwar said that it was imperative for the political dialogue process to resume for progress in the trade talks and extension of further concessions. “We can’t expect just one part of the body to move while the other parts are still. Trade talks can’t happen in vacuum.” he said.

Dialogue process While India-Pakistan were poised to re-start bilateral dialogue which got stalled after violence at the Line of Control in January last year, there was a further set back last month when a dialogue/of Foreign Secretaries got cancelled because the Pakistan Envoy to India decided to meet separatist leaders in New Delhi.

Pakistan and India had signed a road-map for trade liberalisation in September 2012 under which Islamabad should have already extended the MFN status, which is now called the non-discriminatory market access (NDMA) status, to New Delhi.

But, earlier this year, the Pakistani Cabinet stopped short of passing the resolution of NDMA, as it said it first wanted the new Government to be in place.

Indian view “It is quite understandable if Pakistan wanted a new Government to be in place first before it extended NDMA to India. But it has to now make it clear to us whether it is having a re-think on the matter,” said Arvind Mehta, Joint Secretary, Commerce and Industry Ministry, at an Indo-Pak meet organised by FICCI.

Anwar said that while there was indeed a road-map in place for trade liberalisation, under the proposed move, business people from both sides could be allowed to meet each other at the border without going through the visa process.

They could then be allowed to spend time with each other to discuss their proposals then go back to their respective countries.

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