Friday, November 11, 2011

Manmohan-Gilani Summit: Opening New Chapter in Bilateral Ties

India and Pakistan have talked about writing 'a new chapter' in their accident-prone ties, with Islamabad assuring New Delhi that the terrorists behind the Mumbai carnage, that virtually froze relations between the neighbors, will be brought to justice soon.
In a sign of the new spirit of mutual accommodation, Prime Minister Manmohan Singh and his Pakistani counterpart Yousuf Raza Gilani agreed to open a new chapter in ties and hoped the next round of talks will be 'more productive and constructive'.
Meeting on the sidelines of the 17th South Asian Association for Regional Cooperation (SAARC) summit in Addu (the Maldives), the two leaders held delegation-level talks for around half an hour in a seaside beach cottage at the idyllic Shangri La resort hotel and followed it up with nearly 45 minutes of one-on-one talks.
In addition to resolving to candidly discuss all outstanding issues, ranging from Jammu & Kashmir to Sir Creek, the Prime Ministers focused on terrorism and trade. The two leaders agreed that the measures to facilitate trade and travel across the Line of Control, decided upon by the Foreign Ministers in their July meeting, should be implemented expeditiously. Both Prime Ministers urged a greater degree of openness in discussing all issues of discord during the next round of line Ministry-level talks.
Terrorism Menace
With relations having languished since the cataclysmic 26/11 terror attacks nearly three years ago, the two sided agreed to push a host of initiatives, including the revival of the joint commission, a preferential trade agreement and liberal visa regime.
The Indian prime minister conveyed to his Pakistani counterpart that both countries have an obligation to ensure that terrorism does not spoil relations between them and pressed for justice for 26/11 victims.
Terrorism is a perennial concern. We have an obligation to ensure that it does not spoil relations between the two countries," Manmohan conveyed to Gilani during talks.
Singh told Gilani that "it is imperative to bring the perpetrators of 26/11 attacks to justice." The two leaders agreed that terrorism posed the most serious threat to peace and stability in the region."
Foreign Ministers’ Meeting
External Affairs Minister S.M. Krishna and Pakistani Foreign Minister Hina Rabbani Khar discussed trade and terrorism issues with a view to broadening the two countries’ engagement.
The two ministers informally indicated to the media that the atmosphere was positive. Krishna is learnt to have stressed the need for Pakistan to deal effectively with those responsible for mounting the 26/11 attacks on Mumbai, and not allow its soil to be used by terrorists targeting India.

MFN Status
India announced a trade-related confidence-building measure to match Pakistan according the Most Favored Nation (MFN) status to India. Ms Khar indicated Pakistan would soon finalize its decision to offer India the “MFN” trading status as a means to widen the engagement process.
Earlier on 2 November, Pakistan decided to grant MFN status to India, 15 years after New Delhi accorded it the same level of treatment.
MFN is a level of treatment accorded by countries interested in increasing trade with each other. Countries achieving MFN are given trade advantages such as reduced tariffs on imported goods. Special consideration is given to countries classified as "developing" by the World Trade Organization (WTO), which also enforces the status.
Pakistan has already bestowed MFN status on over 100 countries, including its all-weather friend China, but had been hesitant to do so in the case of India because of the fear that Indian exporters may flood Pakistani markets with their merchandise once normal trade is allowed.
Formal trade between India and Pakistan averages $ 2.5 billion annually, it is the informal route through the trading centers of Singapore and Dubai that is bigger and is estimated to be around $ 3.5 billion. Now Pakistan has granted India MFN status, formal trade may shoot up to $ 6 billion. Pakistan’s Planning Commission estimates that trade will to grow to $ 10 billion soon once MFN status is given to India. Freeing up many trading items could see the two countries making value additions to each other products.
Preferential Trade Agreement
India has decided to move toward a Preferential Trade Agreement (PTA) with Pakistan as both sides agreed to put in place a liberalized visa regime soon.
The decision to move towards a Preferential Trade Agreement with Pakistan under the South Asian Free Trade Area (SAFTA) that will lead to zero customs duty on all traded goods by 2016 came during Singh-Gilani meeting. The two leaders also agreed that bilateral trade will be conducted on Most Favored Nation basis.Both leaders decided to put in place a liberalized visa regime that is being negotiated at the earliest and revive the Indo-Pak Joint Commission that has not been in operation since 2005. The SAFTA is an agreement reached in the 2004 SAARC summit in Islamabad which created a free trade area of 1.8 billion people in Bangladesh, India, Bhutan, Maldives, Nepal, Pakistan and Sri Lanka.

No comments: