The goods trade between India and Pakistan could zoom to $8 billion a year from the current $2.6 billion in two years, thanks to the opening of a check post at Attari-Wagah border, trade body Assocham said.
With the opening up of the check post at Attari-Wagah border, the number of trucks crossing the border will rise to about 600 from the current 150, Assocham hoped.
Both countries used to have, and continue to have, restrictions on what items may be traded across the borders. Some of the restrictions have been done away with, and more are expected to go in the coming months.
“Nearly 6,000 items can now be imported into Pakistan from India as against less than 2,000 items earlier,” it added.
Informal trade between India and Pakistan via third countries like the United Arab Emirates (mainly Dubai), Singapore and Hong Kong is estimated at five to seven billion dollars. Legalisation of trade is expected to reduce costs and increase government revenue by collecting duties on imports.
“The decision to move towards a negative list approach will go a long way in saving time and costs incurred by third country trade route that encompasses in almost 20,000 items, which could otherwise follow the bilateral route,” said Assocham president Rajkumar Dhoot while releasing the study.
Islamabad has committed to bury the negative list of 1,209 items by the end of this year and move to a regime that is in line with WTO rules
Pakistan had recently agreed to grant the ‘Most Favored Nation’ status to India as well, giving trade with India greater ease. India granted MFN status to Pakistan in 1996.
Pakistan has also expressed willingness to give India transit facilities for trade with Afghanistan and Iran – especially in energy and infrastructure projects.
Potential areas for cooperation between the countries are petroleum products, iron and steel, pharmaceuticals, chemicals, automobiles, heavy industries, electricity trade, small and medium enterprises, IT and IT-enabled services, telecommunications, transportation and financial services, Assocham said.