ISLAMABAD, 30 March 2006 — Pakistan and India will accelerate plans to open bank branches across their borders to promote trade, officials said yesterday.
A joint statement issued after three days of talks between top commerce officials also said Pakistan, which has been reluctant to increase trade with India until there is more progress on political disputes, would consider enlarging a list of commodities from India.
The South Asian rivals said they would promote trade by rail and jointly patent their famed Basmati rice in the latest round of peace talks concluded yesterday, a joint statement said.
Top Commerce Ministry officials from both sides held three days of discussions in Islamabad.
The two sides agreed to “identify the problems of transportation of goods by train” and railway officials would continue a dialogue to address them, the statement said.
It also said the two countries’ central banks should “expeditiously” process applications from each other’s commercial banks to open branches. Pakistani Prime Minister Shaukat Aziz had first proposed the step in 2004.
India and Pakistan began a peace process to resolve all disputes two years ago.
But despite discussions on a host of confidence-boosting measures, Pakistan complains that progress on settling core disputes, such as the row over Kashmir, has been too slow.
Trade between the two remains hostage to progress on Kashmir.
Bilateral trade has grown since the peace process started, but it remains well below $1 billion a year, and under $2 billion including a black-market trade often routed via Dubai.
“Pakistan would consider enlarging the list of importable items from India...,” the statement said.
Pakistan has close to 800 items on that list. But it feels the balance of trade already favors India too much, and has not accorded India most-favored nation status, although New Delhi has granted Pakistan that status.
The two sides said on Tuesday they had agreed to jointly patent a popular variety of aromatic Basmati rice, finally uniting to counter the patenting of three varieties of long-grain rice under the same name by a US firm in 1997.
Both countries will work out details and suggest policies to register Basmati worldwide over the next few months, Shah said at a news conference with his Indian counterpart S. N. Menon.
During the talks, the Indian side offered to sell more tea to Pakistan.
Pakistan is the world’s third-largest buyer of tea, but it only buys around $600,000 worth from India each year.
The two sides also agreed to facilitate Indian exports to Afghanistan through Pakistan and upgrade facilities at their border railway stations to handle exports to Afghanistan, it said. Afghanistan,
Pakistan’s western neighbor, has no land or sea border with India.
India and Pakistan are linked by two railway lines, the main one is between the Indian capital of New Delhi and the eastern Pakistani city of Lahore.
The second railway line, re-established last month, 40 years after it was severed due to a war, connects Pakistan’s southern Sindh province with the western Indian state of Rajasthan.
