MFN with India to adversely impact industry

The domestic industry is still not prepared for competition with the Indian industry after 16 years of signing up on the WTO, stated Mehnaz Shiraz, a WTO expert on a seminar conducted by Lahore Chamber of Commerce and Industry today. The industry is still trying to shy away from its commitments under the WTO with India. She also stated that the terminology of ‘Most Favoured Nation’ used in the WTO area was a misnomer as the term meant that every trading partner will be given equal treatment and if concessions have been offered to one WTO member, it must be offered to all other members. She added that India had already given Most Favoured Nation status to Pakistan in 1996 but imposed Non Tariff Measures such as Product standards, custom procedures, licenses, inspections. If the Government of Pakistan was now going to give the status of MFN, it could make use of the same exception clauses.
She also added that the private sector needed to revive its Associations and Chambers to come up with a joint strategy for the entire sector. Muhammad Anum Saleem, Lecturer at LUMS and a WTO Expert stated that to effectively counter the Indian threat, Pakistan’s industry needs to use Trade Defence Laws available in Pakistan such as Anti Dumping Duties Ordinance, Countervailing Duties Ordinance and Safeguards Ordinance. He also stated that the laws could even be pressed into service if there was a threat of injury to the industry.
Saleem lamented the fact that there was no reported case under the Countervailing Duties Ordinance and Safeguards Ordinance in Pakistan and Pakistan was also slow in going to Dispute Settlement Body of the WTO (“DSB”) in Geneva. He said that India was a frequent user of the DSB and had almost 300 trained lawyers in the trade area while Pakistan had just a few. India had gone to the DSB 16 times as compared to Pakistan which had perhaps gone only a few times. Mr. Saleem added that every businessman in Pakistan could approach the High Court to protect its fundamental rights if it felt threatened from the granting of the MFN status to India provided meaningful consultations with the relevant industry had not been undertaken by the Government of Pakistan. Quite recently, the Islamabad High Court had exercised its jurisdiction in this matter, he added to protect the local industry. While giving specific examples from the industry, Mr. Saleem informed the audience as to how India was getting ready to dump its products in the local market to drive out competition and give rise to unemployment and poverty. However, he assured the audience that by making use of the relevant laws, the Industry could get five to ten years’ protection even after the giving MFN status to India.
The measures could be invoked even if only the threat of serious injury was present, he said as the Trade defence laws were enacted under the WTO regime and arose out of exceptions of the GATT Agreement of 1994. At present, the exports of India to Pakistan were approximately Rs1.2 Billion compared to a meagre Rs200 Million exports from the Pakistan side and a big Indian Manufacturer is seeking to export huge quantities of Pet Coke to the domestic industry as a substitute to Furnace Oil.