MFN does not mean extraordinary access to markets - PAK Commerce Minister

Sai Nikesh | The Dollar Business Not an extraordinary market access, instead, India will likely be granted a Non-Discriminatory Market Access (NDMA), said Pakistan Commerce Minister in a recent announcement. Khurram Dastgir Khan, Commerce Minister, Government of Pakistan, on Saturday stated, “There is an incorrect perception among many that Most Favoured Nation (MFN) status to India means giving it extraordinary market access, which is actually not correct. That is why we decided to replace this term with NDMA.” However, he said granting NDMA status to India is almost same as MFN status, which it was supposed to give India under its treaty to World Trade Organisation. Referring to Pakistan Prime Minister Nawaz Sharif’s personal opinion on liberalisation of trade between India and Pakistan as a policy priority, the Commerce Minister said both the countries are mulling to move towards this direction. Giving NDMA status to India will protect our business interests, said the Pakistan Minister, adding that Pakistan was looking to protect its agriculture business by giving grants to India. Earlier, when contacted by The Dollar Business, Choudhry Hamid Malhi, President, Livestock Farmers & Breeders Association in Pakistan, had also said, “Farmers in Pakistan are not opposed to trade, but have reservations regarding the level playing field due to enormous subsidies by India to its agriculture sector, whether WTO compliant or not.” The financial constraints in matching the Indian size of subsidies to its agriculture sector can in no way be considered as a permission to give unfair competition to Pakistan’s agri products, he added. In a statement last week, Pakistan’s High Commissioner to India Abdul Basit had raised concerns over providing MFN status to India stating that would will adversely affect Pakistan’s economy because of the uneven trade. Even after India gave MFN status to Pakistan in 1996 under a WTO agreement, Pakistan has not reciprocated so far. Lastly, it was in 2012 that Pakistan promised to give the MFN status, but failed to do so till date. Even in its latest announcement, Pakistan says it may grant non-discriminatory status and has not made clear anything on granting most favoured nation status, as under WTO. Currently, bilateral trade between India and Pakistan stands at around $2.7 billion, but it could surge to over $10 billion if the MFN status is awarded to India.  

This article was published on February 7, 2015.