India awarded MFN status to Pakistan in 1995 under its World Trade Organization's obligations, but Pakistan has not followed suit.
Commerce Ministry figures show that between them, India and Pakistan import and export about 600 items worth $35 million every year. The Economic Survey of Pakistan gives a much higher figure of $250 million. Independent studies, however, put the
bilateral trade at between $1 and $2 billion -- most of which involves smuggling. Smuggled videotapes of Indian films, artificial jewelry and cosmetics are popular in Pakistan. Videotapes of Pakistani
television plays and dry fruit are smuggled into India.
Pakistan loses an estimated $500 million annually in custom duties to smugglers. But Pakistan still imports wheat from the
distant United States, which it could buy from India, and costly medicines and farm
fertilizers from third nations even though they are much cheaper from India.
And in early September, the military rulers rejected a proposal to sell surplus electricity to energy-deficient India, even
though the producer offered to give half the profit from the sale to the Pakistani
government.
Peace groups see trade as the only hope for normalizing relations between the two nuclear-armed neighbors.
For them, each trainload of sugar brings more hope, but others continue to question
whether this is enough to sweeten the bitter ties between the two foes.
Commerce Ministry figures show that between them, India and Pakistan import and export about 600 items worth $35 million every year. The Economic Survey of Pakistan gives a much higher figure of $250 million. Independent studies, however, put the
bilateral trade at between $1 and $2 billion -- most of which involves smuggling. Smuggled videotapes of Indian films, artificial jewelry and cosmetics are popular in Pakistan. Videotapes of Pakistani
television plays and dry fruit are smuggled into India.
Pakistan loses an estimated $500 million annually in custom duties to smugglers. But Pakistan still imports wheat from the
distant United States, which it could buy from India, and costly medicines and farm
fertilizers from third nations even though they are much cheaper from India.
And in early September, the military rulers rejected a proposal to sell surplus electricity to energy-deficient India, even
though the producer offered to give half the profit from the sale to the Pakistani
government.
Peace groups see trade as the only hope for normalizing relations between the two nuclear-armed neighbors.
For them, each trainload of sugar brings more hope, but others continue to question
whether this is enough to sweeten the bitter ties between the two foes.
Comment