Pakistan had made a commitment with India that the negative list would be phased out before December 31 this year, which implies that New Delhi will be granted the status of Most-Favoured Nation (MFN) status from the new year. Official documents obtained by Business Recorder show that a team of the Commerce Ministry officials will hear the concerns of automobile, agriculture, textile and pharmaceutical sectors as the four sectors are making a hue and cry over what one of the stakeholders stated was an ' ill advised' move on part of the Commerce Ministry.
According to the agreement, in the first phase, India had promised to reduce SAFTA sensitive list by 30 per cent before October 2012, in lieu of opening of Wagha border. In the second phase, India has to reduce SAFTA sensitive list by an additional 30 per cent by November 2012 after which Pakistan will be required to phase out negative list by December 31, 2012. India has to eliminate entire sensitive list in five years. However, both Pakistan and India have not implemented the agreement in letter and spirit. Indian High Commissioner Sharat Shabarwal also expressed concerns over Pakistan's slow implementation of agreed decisions.
On Tuesday, the Commerce Ministry's officials discussed concerns of various sectors and finalised their policy for deliberations in Lahore. President of Basmati Growers Association Hamid Malhi stated that agriculture contributes 22% to the national GDP but no farmer organisation or even selected individual farmers from any province was consulted before evolving the trade liberalisation policy with India. He argued that exporters, traders, processors of agricultural goods do not represent the farming community and neither are they authorised to represent farmers.
Acting Secretary, Ministry of Commerce was recently caught off guard during a presentation to the Standing Committee of the Senate on Foreign Affairs, and later at the meeting of the Public Accounts Committee of the National Assembly, when asked to show any record of consultation with farmers before entering into a dialogue on the issue, with India. Unfortunately, agriculture which is not being represented by a Ministry at the federal level during the last two years was taken for granted.
Farmer are not against trade with India but expect to be protected against the highly subsidised agriculture products of India, he continued. On an average each agriculture hectare gets a subsidy of 300 USD per year in India. This works out to around Pak Rs 11,900 per acre of subsidy or for a 30 maunds (40Kg) average production of any commodity, Indian farmer enjoys a comparative advantage of Rs 400 per 40 Kg. This necessitates that unless each agri product imported from India is not subjected to import duty at the rate of Rs 400 per 40 Kg, the Pakistani farmer producing the same product would be at a disadvantage.
Reliance on Indian goods should never be an option. The Bangladesh experience of 2010-11 when 500,000 tons of wheat & rice were transacted to be exported by India to Bangladesh to avoid a food scarcity situation never materialised even after advance payment.
The recent cotton export restrictions, the cement import impediments and other Tariff and Non Tariff Barriers (NTBs) by India to protect its agriculture and industry also need to be kept in mind. Even the US has complained about hidden undisclosed trade barriers and export subsidies by India at the WTO. Pakistan's trade imbalance with India has increased from 80:20 to 85:15 in the last one year.
Agriculture is the livelihood of 65% of Pakistan and it is not just parliamentarians who will suffer but also the country's economy. "What sort of liberalisation policy is this, if it doesn't favour the country? Who are the people pushing it to the detriment of our economy? Are the negotiators competent enough to carve a fair & free trade policy for agriculture with India?" Malhi questioned.