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Granting NDMA status to India

Granting NDMA status to India

Islamabad is seriously considering granting Non Discriminatory Market Access (NDMA) status to New Delhi in the aftermath of a lucrative offer made by India by offering to remove 514 items from sensitive list in next six months out of total 614 items.

The abolishing of sensitive list of 614 items comprises all such products such as textile, leather, surgical products which possess the potential to boost exports of Pakistan made-ups over the medium term.

“The offer made by outgoing Indian government seems lucrative and Pakistan might accept it by providing MFN or NDMA status to New Delhi after getting approval of the federal cabinet,” said the top functionaries of the government.

It is not yet known whether the political leadership has taken the military establishment into confidence or not but the new security paradigm endorsed by GHQ focuses on allowing trade and normalizing relation with neighboring India.

But there are some relevant questions that need to be answered before moving ahead. There are general elections around the corner in India and at this juncture how it could be guaranteed that incoming government in New Delhi would honor the commitment of its outgoing government especially in case of Pakistan.

If any unwarranted incident happened on any side some kind of mechanism should be in place that ensures continuation of trade relations between the two countries. If trade becomes hostage of other issues then it cannot become long lasting in case of Pakistan and India.

Another important thing is that how much the government has placed the required infrastructure for boosting bilateral trade such as customs clearance mechanism at Wagha border is not sufficient to handle bulk of import and export products in one go. So the construction of infrastructure at road, rail and ship links is pre-requisite for boosting trade with India.

The trade managers of the country claims that by restoring normal trade relations with India, the country’s exports could go up from $300 million to $2.5 billion over the medium term. The major boost in increasing exports could provide the textile sector a 60 percent share and the agri sector a 25 percent share.

According to estimates made by Ministry of Commerce, Pakistan could save $1 billion in its import bill in the wake of proximity. The country’s GDP can go up by 2 percent over the next three years.

Pakistani common consumers could save Rs 70 billion in view of decreased freight in case of allowing imports from India.

In the initial stage, in case of opening up of trade between Pakistan and India, the chemicals and raw materials would be the major items on both sides.

There are concerns expressed by agriculture, pharmaceutical and auto industry over possibility of normalizing trade with India. The government has responded that there will be safety valves going to be in place to protect their genuine interests.

As opening up of trade with India is largely beneficial for both countries, but the people of Pakistan should be taken into confidence that initially it will be in the favor of India but then Pakistani entrepreneurs will have to respond after getting market access of over one billion population living across the border.