ISLAMABAD – New Delhi has raised duties on major Pakistani products as aprotest against last week’s terrorist attack on its paramilitary soldiersfor which it blames Islamabad.
Around 300 trucks carrying cement, one of Pakistan’s major exports toIndia, were stuck at the Wagah border after duties were suddenly increased200%. This made importing them very expensive or nearly impossible.Shipments of 170 containers by sea also came to a grinding halt.
The Indian market accounts for a quarter of Pakistan’s total cementexports. In the last financial year, Pakistan sold India $23 million worthof cement. Fruit and vegetable exporters will also bear the brunt of thereaction since they exported $41 million in production.
This economic development has come in response to a terrorist attack on theCentral Reserve Police Force. More than 40 personnel were killed in Pulwamadistrict of Indian-Administered Kashmir. New Delhi accused Pakistan-basedJaish-e-Mohammad. Pakistan has asked India to provide any evidence to provethe claim.
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The chain reaction started with India revoking Pakistan’s most-favourednation status, which affects trade. In 1996, India awarded Pakistan MFNunder the World Trade Organization General Agreement on Tariffs and Trade.Both countries are signatories to it.
Under this arrangement, they are supposed to treat each other as favoredtrading partners while imposing customs duties.
