The Hindu, India

Don’t let Kashmir stand in the way of trade ties: India

Islamabad discriminating against New Delhi in SAFTA implementation

By Nirupama Subramanian

20 April 2007

ISLAMABAD: Pakistan is in violation of the agreement on South Asian Free Trade Area (SAFTA) and the Vienna Convention by discriminating against India in the implementation of the regional accord, aside from risking its credibility as a negotiating partner, Indian High Commissioner Satyabrata Pal told a conference here.

Speaking at the closing session of a two-day SAARC roundtable on SAFTA earlier this week, he said implementing the trade agreement would benefit Pakistan, but stressed that India, playing for global stakes, had only a marginal interest in the comparatively small Pakistani markets and investment opportunities.

Pakistan has not implemented SAFTA with India, and the trade between the two continues on the basis of a positive list of about 1,000 items only. Indian goods outside the list are imported through third countries at marked up prices, imposing hardship on the Pakistani consumer. If doubts do arise about the value of Pakistan's formal commitment to a negotiated agreement, it will become much more difficult for us to reach closure on many other issues not at all concerned either with SAARC or with trade," Mr. Pal said. At no stage of thepainstaking’’ negotiations on SAFTA, did Pakistan indicate that it would not apply to India, although each member-country had every opportunity to spell out its positions.

Making a case against letting the Kashmir issue stand in the way of normalising trade relations, Mr. Pal urged Pakistan to follow the India-China example of building trust in other areas as they talked on the difficult border issues.

"We do not belittle the importance of putting the problem of Kashmir behind us, not least because it has been the cause of conflict... We will continue to work on this but we hope that everything else will not be held hostage to it."

When the Iran-Pakistan-India pipeline was politically acceptable to Pakistan, why not SAFTA and normal bilateral trade?

While India had no Pakistan-specific non-tariff barriers, it was ready to address any specific grievance to help Pakistani exports. India was also planning to reduce its non-tariff barriers, and Pakistan would stand to benefit by this measure, he said.

Disagreeing with Pakistan’s latest position that SAFTA was subject to domestic laws and that the positive list" was part of the country's trade policy, Mr. Pal quoted the Vienna Convention thata party may not invoke the provisions of its internal law as a justification for its failure to perform a treaty.’’

The SAFTA agreement was also clear that signatories to it had no "reservations.’’

The conference, at which all SAARC nations were represented, made recommendations including lifting non-tariff barriers, easing travel and visa restrictions to enable businessmen to travel more freely, inclusion of the services sector in SAFTA and a revision of the ``sensitive list.’’