Title - India, Pak Sign Three Agreements to Facilitate Trade | news.outlookindia.com

India and Pakistan today signed three agreements to facilitate bilateral trade even as New Delhi offered to supply 100 railway locomotives and help set up thermal or hydroelectric power plants of up to 2,000 MW.

The agreements were signed at the conclusion of two-day talks between the Commerce Secretaries of the two countries.

Their discussions focussed on measures to boost bilateral trade and cooperation in new areas like opening of bank branches and cross-border investments. One agreement will cover cooperation and mutual assistance in customs matters while another will help redress trade grievances.

The third pact between the Bureau of Indian Standards and the Pakistan Standards and Quality Control Authority (PSQCA) was for conforming standards in the two countries.

Both sides directed authorities to frame rules and procedures to fully implement these agreements, which are expected to substantially facilitate trade mechanisms.

They further agreed that another agreement will be signed between the Export Inspection Council of India and PSQCA. Both sides have already exchanged the draft of this pact.

The Indian side made an offer to supply up to 100 locomotives to the Pakistan Railways, said a joint statement issued after the talks.

The state-run Bharat Heavy Electricals Limited offered to cooperate with Pakistan in setting up coal, hydro or gas power plants of 500 to 2,000 MW.

The Indian side indicated its willingness to cooperate with Pakistan in wind and solar energy. The Indian side also said it is willing to export up to five million cubic metres of gas per day for an initial period of five years. Pakistani side said this offer was "under active consideration".

The Commerce Secretaries reviewed progress on other issues like trade in petroleum products and energy and reciprocal opening of bank branches.

They exhorted the stakeholders on both sides to speed up mutual consultations so that "concrete progress" could be made on these issues within six months.

The meeting between the Indian delegation led by Commerce Secretary S R Rao and the Pakistani side headed by Commerce Secretary Munir Qureshi marked the first round of talks in the new phase of the bilateral dialogue.

The foreign ministers of the two sides reviewed the last round of the dialogue during a meeting in Islamabad earlier this month.

Both sides discussed the phasing out of the negative list regime for trade, which will pave the way for Pakistan to grant Most Favoured Nation-status to India by the beginning of next year.

The joint statement said the "roadmap drawn in the earlier ministerial meetings for liberalized and preferential trade regimes would be scrupulously adhered to".

Pakistan said a formal proposal for removal of restrictions on trade through the land route had been sent to the cabinet and a decision on this issue is expected to be notified before the end of October.

The Pakistani side raised its concerns about what it described as Pakistan-specific "non-tariff barriers".

The Pakistani Commerce Secretary described certifications, licensing, lab testing, delays in customs clearance, non-availability of railway wagons and problems that delay clearance of goods as non-tariff barriers.

The Indian side emphasized the need for eliminating such barriers on both sides.

India and Pakistan have made considerable progress in normalising trade relations since they resumed their peace process last year after a gap of over two years in the wake of the 2008 Mumbai attacks.

Pakistan has said it will grant Most Favoured Nation- status to India by the beginning of next year.

Commerce Minister Makhdoom Amin Faheem told reporters that Pakistan's deadline for phasing out the negative list regime is December 31 and progress is being made in this regard.

Faheem, who witnessed the signing of the three agreements, appreciated the pace of talks aimed at removing hurdles and bottlenecks for trade. The two countries have said they intend to increase trade from the current level of two billion dollars a year to USD six billion by 2014.