ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Most Favoured Nation: New Trade Opportunities for India and Pakistan

The sixth round of trade talks between India and Pakistan is noteworthy for having followed up on all the decisions taken in the fifth round of April 2011. Pakistan has decided to grant the Most Favoured Nation status to India, and the latter has initiated business-to-business and government-to-business interaction for addressing information gaps. These measures could help realise a bilateral trade potential of $25.2 billion, estimated as of 2010, an amount 10 times larger than the current $2.5 billion trade.

Issues in India-Pakistan Trade Negotiations

India-Pakistan bilateral trade negotiations are pegged to two key issues - Pakistan granting most favoured nation status to India and the latter removing non-tariff barriers. The resolution of these issues is likely to result in larger market access gains for India than Pakistan. To achieve mutual benefits, the two countries should, despite recent political events, also focus on removing barriers such as transport protocols that are specific to bilateral trade.
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