Pakistan withholds MFN status to India

Pakistan has delayed granting the Most Favoured Nation (MFN)

status to India, in view of reservations expressed by a number of domestic industries in Pakistan, including the Pakistan textile industry. Makhdoom Shahabuddin, Pakistan’s Minister for Textile Industry, feels a level playing field must be created for textile products of India and Pakistan, by implementing a uniform tax regime, before the MFN status is granted to India.

Pakistan Commerce Minister Makhdoom Amin Fahim is reported to have said the Pakistan Government is trying to resolve the doubts of local entrepreneurs over the grant of MFN status to India. The minister said the decision to hold back abolition of the negative list regime and grant of MFN status to India was taken after he discussed the matter with the Indian Commerce Minister Anand Sharma. The negative list lays restriction on import of 1,209 items from India, which includes 78 textile and apparel items.

Most Favored Nation is a level of status given to one country by another and enforced by the World Trade Organization. A country grants this clause to another nation if it is interested in increasing trade with that country. Countries achieving most favored nation status are given specific trade advantages such as reduced tariffs on imported goods.