Pakistan is likely to impose 200 per cent Regulatory Duty (RD) on non essential Indian imports in retaliation against recent Indian measures and raise the issue of India unilaterally withdrawing the Most Favoured Nation (MFN) status to Pakistan at the World Trade Organisation (WTO) in Geneva, well informed sources told Business Recorder.
The proposal was finalized after more than two hour long meeting in Commerce Division, presided over by Secretary Commerce, Younus Dagha convened to assess the effects of Pakistan's withdrawal from MFN status with particular focus on exports and imports. The sources said Commerce Division has also prepared different options to be presented to the National Security Council (NSC) which is expected to meet within a couple of days, after which a final decision will taken.
According to sources in Ministry of Foreign Affairs, in the aftermath of terror on the Indian security forces in Palwama (Indian Held Kashmir) on February 14, 2019, the Government of India convened a meeting of the Cabinet Committee on Security on February 25, 2019. Following the meeting, the Indian Union Minister for Finance stated that Pakistan's MFN status stands withdrawn. According to reports, around 300 trucks are standing at Wagha border, carrying cement and dry dates (Chuhara) after India clamped 200 per cent RD on Pakistani products. Shipment of 170 containers from sea route was also stopped. Pakistan exports to India from land route constitute around 70 percent of our total exports to the country.
Pakistan cement exports to India during 2017-18 amounted to 1.2 million tons and during the seven months of 2018-19 cement exports were around 648,000 Metric Tons. The sources stated that cement can be exported to other destinations like Sri Lanka and Africa, but the issue of dry dates is critical as India is a big market of this product.
The sources further stated that the issue of withdrawal of MFN status will be taken up at the WTO as no country can withdraw the status after granting it. Pakistan has not granted MFN status to India so far. Some participants of the meeting argued that Pakistan should withdraw trade concessions extended to India whereas another view was that negative list should be expanded like in the past. Some participants stated that Pakistan should slap Non Tariff Barriers (NTBs) on Indian imports while pothers suggested that since India has violated SAFTA which is a bilateral agreement, Pakistan should also reciprocate in the same tone.
There are reports that Afghan trucks, carrying perishable items destined for India through Wagha border are also stuck due to a large number of Pakistani trucks.
"We will present different options to the NSC one of which will be to impose 200 per cent RD on non essential items," said one of the senior officials on condition of anonymity. The Ministry of Foreign Affairs, sources said, has left it to the Commerce Division to suggest retaliatory measures against Indian decisions.
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