Source: Daily Times

NEW DELHI: Trade across Line of Control (LoC) in Jammu and Kashmir has been delayed due to internal disturbances in Pakistan, Indian Minister of State for Commerce Jairam Ramesh told a seminar here Wednesday.

An agreement for the LoC trade was ready to be inked, but was delayed due to internal disturbances in Pakistan, he said at the function organised by Institute of Peace and Conflict Studies (IPCS).

“We had given them a list of 14 items to be traded across the LoC, which Pakistan pruned down to nine. But, even this is something to start with covering agriculture and handicrafts,” he said adding that the agreement ready to be inked also included locations for trade. The Indian minister said they were awaiting Pakistani nod to go ahead with the agreement.

Jairam Ramesh said Sri Lanka, Bangladesh have now been removed from the list of countries from where foreign direct investment was banned leaving Pakistan only in the ‘in solitary splendour’. He admitted that India would need to give the right signals on the issue of direct investment, indicating that even Pakistan could eventually be removed from this list. ‘There is now a strong case for a similar treatment for Pakistan on a case-to-case basis,” he added.

He pointed out the next phase of SAFTA will deal with investment and services. The next meeting on SAFTA will be held in Delhi next month, when Afghanistan will be inducted as the eighth member.

He further said that India was currently reviewing its list of 744 sensitive trade items, which are dominated by agriculture and textiles. “Prime Minister (Manmohan Singh) mandated us to review the list … So we may make an announcement shortly,’ he said.

India had already issued a notification for dropping import duties to zero on 4,537 items from the five less developed countries in South Asia on the first day of 2008, Ramesh said. He said liberalising the investment regime could solve the bugbear of India’s neighbouring nations about the surplus deficit. ‘I believe that investment is the only way to manage trade deficit with India,’ said Ramesh.

He gave the example of Sri Lanka that had a deficit of one to ten with India just a decade ago. “Now after the FTA (free trade agreement), there has been investment by Indian firms, who have set up factories and then sell products back to India. The deficit has now come down to one to five, which is manageable,” he revealed. Former Prime Minister I.K. Gujral, who also addressed the seminar called for grater connectivity and reducing the travel fares within South Asia countries. “If the train from China has reached Tibet, there should be every effort to connect South Asia from within in order to develop the region,” Gujral said. iftikhar gilani

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Tags: indian minister, Institute of Peace and Conflict Studies, internal disturbances, jairum ramesh, line of control