High tariff barriers in India major hurdles in trade

The current high tariff and non-tariff barriers in India are major obstacles in granting (MNF) Most Favoured Nation status to India and liberalise trade between the two countries.

According to a message received on Monday from New Delhi, the leader of SAARC CCI, Pak chapter delegation, Iftikhar Ali Malik, stated this while addressing a special meeting of the SAARC Chamber of Commerce and Industry.

Highlighting his point of view and keeping Pak traders interest supreme, he said Pakistan could benefit from granting MNF status if India fully ensures a level playing field by removing non-tariff barriers and reduces tariff on items of interest to Pakistan.

He said further lowering of tariff barriers could be done through negotiations of PTA/FTA concessions on items of Pakistan’s export interest in particular textile, light engineering and agricultural goods can be considered. He said bright chances existed for trade compatibility due to lower cost of freight, snaller transit and shipping period, besides similarity of spoken language.

He said the availability of level playing field was one of the major challenges, while India had been gradually reducing its tariff over the last two decades, and the tariff regime was still complex.

He said import taxes were high in sectors of interest to Pakistan like textile, and agriculture besides provision of direct and indirect subsidies and concessions under different schemes to Indian counterparts.

Iftikhar Ali Malik said India’s sensitive list protects wide range of textile and agricultural products which was hampering the interest of Pakistan side. For example, Pakistan has 10 per cent duty on import of rice whereas India has 80 per cent. He said currently Pakistani exporters were facing a number of non-tariff barrier including non-existence of trade-related services, direct banking channels, direct shipping lines, delay in issuance of multiple visa, cumbersome inspection and clearance procedures and cargo handling facilities.

He said Confederation of Indian Industry could also play a key role to promote India-Pakistan bilateral trade to streamline relations between two large members of the SAARC for stronger region trade and prosperity in the region.

He stressed the need to address all the issues being confronted by importers and exporters of either country on top priority as this would save precious foreign exchange by saving the transport cost of approximately $ 400 to $900 million.

He suggested to phase out restrictions on Pakistani exports and on the other hand Pak traders can import industrial raw material like dyes, chemicals, paper, plastic, iron ores etc from India.