ISLAMABAD/ NEW DELHI: Pakistan’s newly-appointed finance minister Hammad Azhar on Wednesday announced that the government has decided to allow import of sugar, cotton and yarn from India.
The resumption of import of these items will lead to the country’s partial revival of trade relations with India. In August 2019, Pakistan had downgraded trade relations with India in reaction to New Delhi’s decision to revoke Article 370 of its Constitution, which granted Jammu and Kashmir special status.
There was no response from India to the development until late in the evening. Pakistan’s decision to import from India follows the February ceasefire agreement that had sparked speculation about possible efforts by both countries towards normalising ties. However, even as the Indian and Pakistani foreign ministers participated in a multilateral conference in Tajikistan on Tuesday, there was no meeting between the two.
To ensure there was no shortage of essential drugs amid the Covid-19 pandemic, Pakistan had lifted the ban on import of medicines and raw material from India in May 2020. This was the first step of reversing the complete suspension of trade with India.
Prime Minister Imran Khan, who is also minister-in-charge of commerce and textiles, had approved the summaries of importing goods from India before placing it for approval of the Economic Coordination Committee (ECC) of the cabinet.
Addressing a press conference in Islamabad after chairing a meeting of the ECC, the finance minister said the government had allowed the private sector to import 0.5 million tonnes of sugar from India.
“The price of sugar is much lower in India as compared to Pakistan, so we have decided to reopen sugar trade with the neighbouring country for up to 0.5 million tonnes for the private sector,” the minister said.
On allowing import of cotton from India, Azhar said there was high demand for it because Pakistan’s textiles exports had increased but last year’s cotton crop was not good. “The price of the commodity in India is lower than what it is in Pakistan. The import of cotton and yarn through the Wagah border will help meet domestic requirements at reasonable rates,” Azhar said, adding that import of cotton from India for small industries would take place until June.
India is the world’s biggest producer of cotton and the second biggest sugar producer. The import of sugar will help Pakistan lower its soaring prices ahead of the holy month of Ramadan.