Pakistan-india trade has severely been hampered over the years due to breakdowns in communication; lack of available labor and more importantly, due to stringent trade policies. A recent meeting between the Indian joint secretary for Commerce, Arvind Mehta, heading a five-member delegation of Indian regulators and LCCI President, Irfan Qaiser Sheikh, heading Pakistani traders, representatives of the Trade Development Authority of Pakistan and the Federal Joint Secretary of Commerce Ministry, was held recently. Three agreements have been finalized to remove non-tariff barriers. The final agreement is expected to be signed in March during the Indian Commerce Minister’s visit to Pakistan.
The agreements include the Customs Cooperation Agreement to prevent arbitrary halting of goods at each other’s ports, the Mutual Recognition Agreement for acceptance of certificates of internationally accredited laboratories, and the Redressal of Grievances Agreement in case of any disagreement. Furthermore, the tariff line in India for Pakistan will be reduced to 5 percent from the current 8 percent, by the end of the year.
Representatives from Indian Customs admitted of poor infrastructure, institutional framework and labor management, which obstructed transportation of consignments across the border, delayed the obtaining of agricultural permits and clearance reports and also caused the Pakistani side extensive losses in terms of transportation costs. To increase transparency and efficiency, the two sides are working on a three-tier solution – daily or local problems will be handled at the border. A meeting between the Customs collectors will be held once in two months and one meeting at the ministerial level regarding policy matters would be held once in every six months. Licensing requirements pertaining to health, sanitary conditions, imports of vehicles and textile specific barriers would also be addressed. Quality standards improved on both ends and Pakistani authorities asked the Indian delegation to reciprocate and accommodate 150 trucks through Indian customs. An increase in wheeler trucks and offloading equipment was also discussed, to ensure offloading on both borders and expedite the clearance of consignments.