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Huge potential exists in Indian market for Pakistani items

The News - International, Pakistan

Huge potential exists in Indian market for Pakistani items

4 May 2012

LAHORE: Indian market has huge potential for Pakistani items, but experts are discussing India’s import impact on domestic economy, ignoring the potential of services sector exports to that country, according to speakers of a seminar on Thursday.

There is a need for the two sides to remove the non-tariff and tariff barriers and further enhance the infrastructure development and opened new avenues other than Wagah-Atari border, they said.

Pakistani exporters faced numerous valuation problems and pre-shipment inspection issues during trade with India despite availability of South Asia Free Trade Agreement (SAFTA) tariff regimes.

This consensus was developed in a seminar jointly organised by the Trade Development Authority of Pakistan (TDAP) and the Lahore Chamber of Commerce and Industry (LCCI) on “Normalisation of trade with India: Opportunities and challenges”.

The seminar was moderated by Aftab Vohra, LCCI Standing Committee head on Pakistan-India Trade, while Dr Manzoor Ahmad and Nadia Rehman whose consultancy services were hired by the TDAP for conducting a study about the potential of Pakistan-India Trade, gains and losses for Pakistan, also addressed the seminar.
A good number of stakeholders attended the event and raised there concerns with Indian trade and problems being faced by them.
Vohra stressed upon the need to improve the infrastructure development at Wagah border and curtailed the role of National Logistic Cell (NLC).

“The role of the NLC is that of a facilitator, but it becomes a revenue generating authority at Wagah border, creating problems for trade,” he said.

He also suggested that under SAFTA trade consignments should be released on undertaking provided by the importers and exporters as SAFTA certification took time, while the consignment reached at the destination port. The scanner installed at the Wagah-Atari border is useless as it is being used for containerised cargo, but trade is being done in open trucks.

Vohra also suggested creation of a facility at Wagah-Atari border where the business community of the two sides would meet fortnightly in the presence of government officials concerned, as several times the trading community of the two sides told each other that the Customs authorities are creating hurdles, while Customs official denied it.
“Such a facility would end this loophole, creating hindrance in trade,” he added.

Dr Manzoor highlighted the potential for different Pakistani sectors and said that Pakistan can export around $70 million ethanol and $34 million electric fans to India.

Talking about the tariff regime, Dr Manzoor said that in the WTO regime, India kept reducing duties, while Pakistan keep increasing on different accounts, which makes Indians more competitive than Pakistan.
However, he said, “We didn’t really look into the impact of Indian products and industry on our industry when it will flood into Pakistan as a result of free open trade.”

“How our industry will cope with developed Indian industry? He asked, and said that India can dump its products in Pakistan, but National Tariff Commission is in place, which worked on subsidies and dumping cases and suggests action to the government in any such scenario. However, he also observed that the NTC role would be crucial and timely actions would be needed in such a scenario as nothing could be taken when the things would be flooded in Pakistan, which might affect the domestic industry.
Dr Manzoor admitted that the pharmaceutical had apprehensions from trade with India. “The reasons of their apprehensions are that prices of same multinational companies’ medicines have huge difference between the two countries as in India it has one-fourth of Pakistani price, which needs to be addressed as poor people will benefit from this,” he added.
He said that during their study they interviewed 60 people, 30 small and 30 big traders with India and almost all of them pointed out valuation problems and pre-shipment inspection issues, which caused huge losses when perishable items were sent there.

Nadia Rehman highlighted tariff regime and non-tariff barriers (NTBs) status, while trading with India for major exporting sectors.