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Pakistan to Ease India Trade Limits
Keywords:
Tags: India,
In an effort to normalize trade relations Pakistan's government plans to move forward with a step by step approach that will end the restrictions on Indian imports by Jan 1, 2013. The first step is ending a system that allows a list of 2000 import items from India and replacing it with a list of 600 items from India that are banned, allowing the flow of all other goods. This negative list will be eliminated by the end of 2012 leaving in place restrictions on sensitive defense items and some staple goods. Ashfaque Khan, dean of Pakistan's National University of Sciences and Technology Business School advises the government on trade issues. The trade between India and Pakistan stands at $2.7 billion for the year ending March 2011. This is much smaller than the $60 billion in trade between India and China which is growing. The trade between India and Pakistan is likely to grow significantly in the next ten years as trade barriers are removed and normal trade is established.
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Boskin says trade models suggest that with normal trade under a free trade agreement India and Pakistan's trade would grow from $2.7 billion today to $50 billion, and be 20 times larger. India-Pakistan trade is smaller today than trade between India and Sri Lanka. Boskin was head of the elder U.S. president Bush's Council of Economic Advisors and instrumental in setting up the North American Free Trade Agreement (NAFTA).
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Trade between India and Pakistan was only $2.7 billion. This is smaller than India's trade with Sri Lanka. Michael Boskin, who was instrumental in setting up the North American Free Trade Agreement says trade models suggest that this should be around $50 billion, or 20 times larger, and would bring benefits in wages and economic conditions in the two countries.
Linked Articles
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Michael Boskin's call for a free trade agreement between India and Pakistan and the current state of trade
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The trade between India and Pakistan was about $2.7 billion in 2011 between neighbors India and Pakistan compared to trade of about $60 billion between India and Pakistan.
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