After much debate and discussion in World Trade Organisation (WTO) and the media, the chapter of European Union (EU) trade concessions to Pakistan has almost closed in the face of bitter opposition from India and Bangladesh. The EU, which had proposed a unilateral trade concession to Pakistan on 75 textile products in the aftermath of the havoc wreaked by the floods last year, has apparently lost hope in approval of the facility from WTO and is likely to withdraw its demand from the organisation shortly, sources told Pakistan Today.
As Bangladesh, apart from India, has also stood in opposition to the draft bill put forward by the EU in WTO for ‘waiver from GATT Articles I and XIII’ concerning autonomous preferences for Pakistan, it is now deemed that further discussion and consultation will be ultimately fruitless. “Both the EU and Pakistan have lost hope in the approval of this facility,” they said adding that the delays have already defeated the purpose of providing immediate relief to Pakistan’s economy. Sources in the Ministry of Commerce, have also confirmed the failure of the EU’s trade concessions in WTO saying that, “the chapter has almost been closed. As there is a fixed approval period for concessions in WTO and this period has already been exceeded as the EU held the Council for Trade in Goods of WTO on November 30, 2010 in its drive for a waiver on trade preferences”.
They noted that the final report of general council of WTO is yet to be received on developments in previously held meetings. It was stressed that one fact that has become increasingly clear is that no more meetings are likely to be held in the organisation for seeking the approval of the waiver. The Goods Council would also provide a factual report on the situation to the General Council of WTO, they pointed out.
Though, Peru, Sri Lanka and some other countries which had earlier held reservations over the facility agreed to vote in favor of the EU proposals, intransigence on the part of India and Bangladesh has been the stumbling block in the WTO, they added.
It is pertinent to note that, earlier, the EU had also clarified that the General Council meeting in May 2011 would be the last genuine chance to move beyond the impasse. As the objection on the issue continued during the meeting of general council held last month, the fate of the trade concession was almost certain.
No positive development emerged after the four meetings of WTO since the European Council in its meeting on September 16, 2010 decided to grant Pakistan special concessions to support its ailing economy in the wake of devastation sustained by the unprecedented floods. The total worth of these tariff lines was expected to be about $1.03 billion and the average tariff on these products around 8.86 per cent.
Despite tall claims of the EU and the government in Islamabad regarding the utilisation of diplomatic channels to convince India and other countries which resisted the trade concession for Pakistan, the European proposals could not be pushed through. Furthermore, Pakistani negotiators have also become demoralised and lost hope with regards to the approval of the facility amid the deadlock driven by the neighboring country. The Indian side could not be convinced to grant the reprieve in two foreign secretary level talks held in Islamabad in the past few months, for not opposing the EU draft waive in WTO. Beside Indian opposition, sources claimed that some member countries of EU had also started raising concerns over the trade provision in the aftermath of the killing of Osama Bin Laden in Pakistan.
