ISLAMABAD/KARACHI, Sept 28: India has extended support for Pakistan’s EU waiver package in WTO and is issuing necessary instructions in this regard.

This was announced on Wednesday after a meeting between Commerce Minister Makhdoom Amin Fahim and his Indian counterpart Anand Sharma in New Delhi.

The two countries also agreed to more than double their bilateral trade in the next three years and open a second border trading post.

The understanding reached at the meeting is part of a bid to put back on track the peace process which was derailed by the 2008 Mumbai attacks. Deepening economic engagement between the two countries is seen as crucial to establishing lasting peace in South Asia.

The decisions will add “width and depth to our economic engagement that will help us in defining our future roadmap” as neighbours, Mr Sharma told a joint news conference in New Delhi.

A statement issued by the commerce ministry in Islamabad said that Pakistan and India had agreed to work jointly to double their bilateral trade from the current $2.7 billion to around $6 billion per annum within three years.

A joint statement issued in New Delhi said that both ministers noted that Pakistan and India were entering a new phase of full normalisation of their trade relations.

The statement lauded the visit by a Pakistani minister to India after more than three and a half decades, accompanied by the commerce secretary and more than 50 business delegates.

To enhance bilateral trade, a memorandum of understanding has been signed between the Trade Development Authority of Pakistan and India’s Trade Promotion Organisation.The ministers affirmed that fully normalised commercial links between the two countries would strengthen bilateral relationship and build the bridges of friendship, trust and understanding, to the benefit of their people and promote prosperity in South Asia.

The ministers mandated their commerce secretaries to pursue with vigour the task of fully normalising trade relations and agreed that their countries would cooperate for a high ambition of preferential trade relations under the framework of the South Asia Free Trade Agreement.

They agreed that all mutual obligations contracted under Safta would be implemented with sincerity.

It was agreed that the commerce secretaries in their meeting in November this year would lay down specific timelines to normalise all trade relationships, including dismantling of all non-tariff barriers.

The ministers agreed that joint and concerted efforts would be made in all areas to create an enabling environment for trade and to encourage greater engagement between the business communities of both countries.

They agreed to further promote greater intra-regional connectivity through road, rail, shipping and air.

It was noted that the customs arrangements had been significantly synchronised and both sides were vigorously addressing issues of infrastructure to further promote trade through the land route of Attari-Wagah.

The ministers noted that over the past few months Pakistan and India had constructively engaged towards a liberalised business visa regime and it was agreed that the regime would be concluded before November this year to allow multiple entry and could be for a period of up to one year.

The ministers expressed the hope that the new visa regime would rapidly expand the vista of bilateral commerce.

The ministers agreed that the bilateral trade liberalisation process should be uninterruptible and irreversible and asserted that both countries would cooperate and work in close coordination at multilateral forum, such as the World Trade Organisation and Saarc, to support each other for strengthening their economies.

Welcoming the outcome of Pak-India trade talks, the head of the European Union Delegation to Pakistan, Ambassador Lars-Gunnar Wigemark, said the decision was also relevant in the light of renewed floods in Sindh and Balochistan.

The WTO waiver was originally sought by the EU for unilateral trade concessions for Pakistan to provide relief after last year’s devastating floods. The selected 75 products represent almost 900 million euros worth of Pakistani exports to the EU, accounting for about 27 per cent of the EU imports from Pakistan, which last year totalled 3.3 billion euros.

The local industry, particularly textile, was pleasantly surprised and considered the decisions taken by Pakistan and India a success of economic diplomacy of the democratic government in a difficult global environment.

Gohar Eijaz, chairman of the All Pakistan Textile Mills Association, termed it a landmark decision that would go a long way in building trust and respect between Pakistan and India to the benefit of people on both sides of the border.

“This is the first good news after such a long time for domestic business, particularly manufacturers. Industry is the only way forward as it has potential to generate employment in a manpower-abundant country like Pakistan. Easy access to Western markets will most certainly give a big push to our industry,” he said.

Europe’s top trade officials were expecting a softening of Indian stance on the issue. “We have information… whereby India will now be prepared to lift its veto,” EU Trade Commissioner Karel De Gucht reportedly told EU lawmakers at the European Parliament, which must also approve the duty breaks.

Formal approval by India could follow at the WTO in early November and subsequently by the European Parliament, opening the way for European duties to be lifted on a list of Pakistani textiles and other products, including ethanol, as early as January next year.

“The news has long-term positive ramifications for the country. Besides lifting spirits of businessmen, it could lead to better opportunities for Pakistan in other markets as well. It will give opportunity to explore new products that will provide a fillip to local industry,” said Shafqat Illahi, another leading businessman.