India, Pakistan sign agreements in customs matters, trade grievances

ISLAMABAD: India and Pakistan today signed three agreements for cooperation in customs matters, redressal of trade grievances and conforming to quality standards to further normalise economic relations between the two countries.

"These agreements are expected to substantially facilitate bilateral trade mechanisms," a joint statement issued after the two-day commerce secretary level talks said.

These pacts are aimed at streamlining trade between the countries and seeking to remove irritants that have prevented bilateral trade from realising its potential.


Commerce Secretary S R Rao was here for the 7th round of talks on Commercial and Economic Co-Operation with his Pakistani counterpart Munir Qureshi.

The joint statement said both sides expressed satisfaction on signing of the agreements and directed the relevant authorities to frame rules and procedures to fully implement these agreements.

During the talks, Qureshi said certifications, licensing and lab testing are not the only non-tariff barriers (NTBs).

He said issues like delays in customs clearance, non availability of railway wagons for cargo transport, absence of direct flights or any problem which delays the clearance of goods with no end results or change, faced by importer/ exporter is an NTB.

He reiterated that concrete solutions for all such issues are crucial for ensuring market access in the Indian markets for Pakistani exporters.

It was also agreed that on the same pattern as mutual recognition agreement between Bureau of Indian Standards (BIS) and Pakistan Standard and Quality Control Authority (PSQCA), another pact between Export Inspection Council of India (EIC) and PSQCA would be signed.

"Both sides have already exchanged the draft texts and it was agreed to complete the internal approvals before the next meeting of the Commerce Secretaries," it said.

Further, it said, that in order to frame rules and procedures to implement the two agreements signed between the Customs Authorities, it was agreed that joint working group on customs would meet in the following month either at Karachi or Mumbai.

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Govt clears FDI proposals worth Rs 2,410 cr

The government on Tuesday said it has cleared 21 foreign direct investment (FDI) proposals worth Rs 2,410 crore, including eight from the pharmaceutical sector.

The Foreign Investment Promotion Board (FIPB) in its meeting held on August 24 had approved 21 FDI proposals, which include 8 proposals worth Rs 1,842.55 crore relating FDI in brownfield pharmaceutical sector, the Finance Ministry said in a statement.


The board, headed by Department of Economic Affairs Secretary Arvind Mayaram, cleared the proposal of Pfizer Ltd for "induction of foreign equity in an operating-cum-investing company to carry out the business in pharmaceutical sector" to the tune of Rs 800 crore.

Also Sterlite Networks, Dadar and Nagar Haveli, plan to bring in FDI worth Rs 500 crore for telecom business was cleared.

Further, Mumbai based Arch Pharmalabs' proposal for inducting Rs 372 crore of foreign investment for manufacture and sale of active pharmaceutical ingredients has been approved.

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India, Pakistan to ink 3 pacts to boost economic activity

 Hoping that the forthcoming visit of External Affairs Minister S.M. Krishna would lead to a liberal visa regime agreement, Commerce and Industry Minister, Anand Sharma, on Tuesday, said India and Pakistan would soon ink three agreements in the areas of customs co-operation, mutual recognition of standards and redressal of trade issues to give a fillip to economic activity.

Addressing a Pakistani Parliamentary delegation at FICCI’s first India-Pakistan Parliamentary Dialogue, Mr. Sharma said India was ready to grant multi-entry and multi-city visas to businessmen from Pakistan. “I am only hoping that the agreement is signed soon. Mr. Krishna is visiting Pakistan this week-end, and, hopefully, something will happen,” he remarked.

Mr. Sharma said there was a need to also open up more land routes to allow more people-to-people exchange and smooth entry and exit of business community from both nations. “The agreements will be signed soon. It is a matter of weeks, maximum,” he added.

“We will soon be coming out with detailed clarification and guidelines on granting permission to Indian business houses and individuals to invest in Pakistan. There were some doubts, whether the Indian industry is allowed to invest or not. The answer is yes. It is just a procedural formality. I have been informed that it is getting addressed. It is a just a matter of days. So, both ways investment flow will start,” he said. India recently allowed Pakistan nationals and companies to invest in India through the semi-automatic approval route. Bilateral trade between India and Pakistan stood at $2.7 billion in 2010-11.

Haider Abbas Rizvi, a member of Pakistan National Assembly, said that increase in trade and investment would help both sides to resolve other matters. “Our relationship should not become hostage to any issue or incident. Our dialogue process should be irrevocable. We have to ensure this in the future,” Mr. Rizvi.

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Russia joins WTO after 18 years of talks

 After 18 years of negotiation, Russia, on Wednesday, entered the World Trade Organization (WTO), which restricts import duties and subsidies in an attempt to create a level-playing field for international trade.

Analysts and politicians hope that Russia, which has long proven a formidable market to foreign investors because of its byzantine bureaucracy and protectionist tariffs, would be transformed by its entry into the WTO. Russia is one of the last major global economies to enter the group, which has long included other developing nations such asChina.


While consumers here will benefit from the lower cost of imported goods, some worry that struggling industries long coddled by state subsidies, such as agriculture or the automobile industry, will suffer because of foreign competition.

Russians often complain about the burdensome cost of Western-imported consumer products, which range from refrigerators to jeans. With its entry into the WTO, the country will cut its average import tariff by 5.9 per cent, making those imports cheaper.

M. Video, one of Russia’s largest electronics retailers whose shelves are packed with foreign-made CD players and American movies, said Russia’s entry into the WTO would bring more customers into their stores.

“We believe that (entry into the WTO) is going to be a very good decision for our customers in the future, because they will be able to purchase goods with prices harmonised with other economies,” said Enrique Fernandez, chief commercial officer of the company.

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July retail inflation eases to 4-month low at 9.86%

New Delhi: For the first time this fiscal, retail inflation went below the double-digit level at 9.86 per cent in July.

This is lower than June’s provisional estimate of 10.02 per cent and the now revised level of 9.93 per cent for the same month.

The lower retail inflation for July has opened a small window for the Reserve Bank of India to look at a rate cut at its review meeting on September 17, say economy watchers.
Wholesale index


This is even as the overall Wholesale Price Index (WPI)-based headline inflation at 6.87 per cent in July was above the comfort zone of the central bank.

Retail inflation in May and April stood at 10.36 per cent and 10.26 per cent, respectively.

The all-India Consumer Price Index (CPI)-based inflation rate for rural and urban areas for July stood at 9.76 per cent and 10.10 per cent, respectively, official data released by the Central Statistics Office (CSO) on Tuesday showed.

Retail inflation for rural and urban areas stood at 9.65 per cent and 10.44 per cent, respectively, in June.

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Govt. may cut spend, raise NRI deposit rates to boost economy

The steps to be announced on Monday by the government and the Reserve Bank of India may include raising the interest for deposits of Non-Resident Indians, cutting down wasteful expenditures and unveiling a bond issue for overseas investors to improve capital inflows in the wake of the rout in rupee.

Economic growth has fallen to a nine-year low of 6.5 per cent in 2011-12 and industrial output continues to be sluggish with a mere 0.1 per cent growth in April. Inflation too remained at an elevated level of 7.55 per cent in May 2012.

“Private investment in India is constrained by lack of availability of funds. Government might announce some measures for attracting investments and also steps to cut down wasteful expenditures,” said Y.K. Alagh, chairman, Institute of Rural Management.


Hit by a weak global sentiment and subdued local macroeconomic performance, the rupee has lost over 25 per cent in the last one year. It also breached the 57 level against the dollar on June 22, 2012.

Market analysts expect RBI to announce an increase in interest rates for NRI deposits. They also expect government to announce a bond issue to attract inflows.

“RBI may increase the interest rate on FCNR(B) deposit further and announce the issuance of bonds for Non-Resident Indians to address the issues in the short-term” Crisil Chief Economist D.K. Joshi said.

Experts also see steps being taken to reduce the twin deficits. CNI Research Head Kishor Ostwal said, “It might take steps to tame fiscal and current account deficits.”

Finance Minister Pranab Mukherjee had on Saturday announced that the government and the RBI would take steps to arrest the declining rupee and improve market conditions.

“The steps we have taken... And we will be able to take certain measures to be announced on Monday which will improve market condition,” he had said.

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