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The Economic Coordination Committee (ECC) of Pakistan’s federal cabinet hasallowed the private sector to import cotton and white sugar from the neighbouring India.
” The country will import cotton from India starting from end-June this year,” the newly appointed Finance Minister Hammad Azhar told a press conference in the capital, Islamabad on Wednesday.
Azhar said that sugar trade was being re-opened with India this year because of the difference in prices in the neighbouring country.
“We have allowed the import of sugar but in the rest of the world too, sugar prices are high because of which imports are not possible. But in our neighbouring country — India — the prices of sugar are much less as compared to Pakistan so we have decided to reopen sugar trade with India for up to 0.5 million tonnes for the private sector.”
He said the government estimated a difference of 15-20 per cent in sugar prices in India as compared to Pakistan.
About import of cotton from India, the minister said that there was a high demand for it because Pakistan’s textile exports had increased but last year’s cotton crop was not good.
“The difference [in prices] affects the SMEs (small and medium enterprises. Big industry can buy it from Egypt or other countries.”
The resumption of import of these goods will lead to partial revival of trade relations. On Aug 9, 2019 Pakistan downgraded trade relations with India in reaction to the latter’s decision to revoke Article 370 of its Constitution that granted occupied Kashmir a special status.
In May 2020, Pakistan lifted the ban on import of medicines and raw material from India to ensure there is no shortage of essential drugs amid the Covid-19 pandemic. This was the first step of reversing of complete suspension of trade with India.
Previously, cotton, yarn and sugar imports were allowed from all countries except India.
The move to reopen trade on two major commodities comes after the Indian and Pakistani prime ministers exchanged letters in the last week, with Imran Khan saying his country “desire[s] peaceful, cooperative relations with all neighbours, including India”.
Earlier, Indian PM Narendra Modi wrote to Khan on the occasion of Pakistan Day ,where media quoted him as saying, “India desires cordial relations with the people of Pakistan.”
Last month, the two countries’ militaries agreed to abide by an oft-violated 2003 ceasefire agreement in Kashmir, helping to reduce almost daily firing incidents by both sides.
