Trade may toe Radcliffe line

NEW DELHI: The border trade between India and Pakistan may be eased soon. New Delhi and Islamabad are in advanced stage of talks for allowing duty-free exports of Indian spices, saffron, apples and flowers to Pakistan. In return, Pakistani dry fruit, cotton and indigenous spices would get easy access to India.

“The trade on the border would only be limited to the local basket. The trade would not attract duty,” a senior commerce ministry official said. He said the model could be similar to Nathu la in Sikkim which is used for India-China trade, or Moreh for India-Myanmar trade.

The ministry of finance in consultation with the department of industrial policy & promotion will examine the issues and give recommendations for reducing the documentation process.

The proposal for free trade across the border has been cleared by the commerce ministry, the official said. The proposal is in the process of clearance by the ministry of external affairs. According to sources in the government, a study has been conducted in the two countries to identify goods for trade.

While trade in specific commodities may soon get seal of both the governments, the proposal for allowing Indian corporates to invest in Pakistan has hit a road block.

“Pakistan continues to follow a system of a positive list under which it gives access to select Indian goods. It has not agreed to big-ticket investments by Indian corporates,” an official familiar with the political situation said.

Proposals from companies like Bajaj Auto, Tata Motors and Tata Consultancy Services have been turned down by the Pakistani government, sources said.

It has been noticed that Pakistan has also discouraged VSNL’s attempt to pick up an equity stake in Pakistan Telecom Co. The officials point out that Pakistan is apprehensive about the inflow of Indian investments.