New Delhi: With Pakistan promising to
completely normalise trade with India, the third-country
exports of Indian goods to the neighbouring country would
drastically come down, experts said.
"Strong possibilities have emerged that third country
trade, estimated at USD 10 billion, will come down drastically
within two years and would be eliminated by by 2015," SMC
Global Securities CMD Subhash Chand Aggarwal said.
Pakistan has agreed to open its market for over 7,000
items from India in the next three months. At present,
Pakistan allows import of only 1946 items based on positive
list.
From February, 2012, Pakistan would shift to the negative
list of few items, which it would not import. By the end of
2012, it has agreed that the negative list itself should be
removed. This would virtually mean grant of the crucial Most
Favoured Nation (MFN) status to India.
Crisil`s Chief Economist D K Joshi said the two
neighbours need to increase their bilateral trade.
"It is important for us to resume trade. We are
physically close and direct trade will not only reduce the
cost, but also would benefit both," he said.
Once Pakistan widens the market access, India`s exports
to the neighbouring country would immediately leapfrog to USD
7.5 billion, experts said.
This is because the third-country shipments being routed
through Dubai would be directly shipped to Pakistan.
The two-way trade is a paltry USD 2.65 billion.
India had conferred MFN status to Pakistan in 1998.
PTI
