An official announcement to declare India the Most Favoured Nation, or MFN, by Pakistan is expected by the end of this year, a top government official said. The central banks of the two countries are in close touch to clear the way for the opening of bank branches in each other’s territory by early next year. “Actually the cabinet of the Government of Pakistan in principal agreed that India is a business partner. There are some technicalities and after those are resolved then the final shape will be done,” Pakistan’s Federal Commerce Minister Makhdoom Amin Fahim told Khaleej Times at the Annual Investment Meeting in Dubai. New Delhi gave the MFN status to Pakistan in 1996. In recent months, both the countries discussed a lot to increase trade relations. Pakistan drastically reduced the number of Indian products barred from the country and India decided to lift a ban on foreign direct investment from Pakistan. Fahim mentioned that the negative list is being discussed between the two sides through secretaries of commerce and they already have done two meetings. This month again a meeting is going to be held and there will be a lot of progress, he added. “I believe the target is by the end of this year to complete all the requirements,” he said. When asked if there is any expectation that the Pakistan will officially announce the MFN status for India by the end of this year, he replied: “Definitely.” Banks play important role for bilateral trade, the reason why the Reserve Bank of India and the State Bank of Pakistan are exploring the possibility of opening branches in each others’ countries. “In principle, we have decided that the branches of the two countries’ banks will be opened at both sides. Central banks of both the countries will sit together and work out the strategy to go forward, he said, adding: “I think the complete package will be completed by the end of December this year.” When asked about the opening of branches early next year, he said, “yes”. National Bank of Pakistan (NBP), the government-owned bank, confirmed the progress on branch opening in India. “Yes we are working on it and NBP will be the first bank to open a branch in India,” Muhammed Imran Butt, senior vice-president and regional chief executive of NBP offshore banking in Bahrain, told Khaleej Times on the sidelines of AIM. “It will benefit traders of both the countries,” he added. Both the countries are also discussing relaxation in visa rules.
