Pak’s U-Turn on plans to resume India imports after political backlash

Pakistan U-turns on resuming trade with India

Pakistan’s government has made a swift U-turn on plans to allow limited imports of sugar, cotton and wheat from India after a political backlash against the move. The Pakistani government’s economic coordination committee said on Wednesday that import permits would be approved in a bid to rein in rampant inflation, but politicians criticised the apparent thaw in relations with India.

Pakistan Finance Minister Hammad Azhar had said the government made the decision “in the interest of the people”, when asked why trade was resuming despite the Kashmir tension. But on Thursday Interior Minister Sheikh Rashid Ahmed told reporters the decision had been “deferred” until India restored Kashmir’s special status. Pakistan’s economy is in the doldrums, a position made worse by a third wave of the coronavirus pandemic that has seen the reintroduction of partial lockdowns across the country. The import of half a million tons of sugar would likely have slashed prices by up to 20 percent ahead of the forthcoming fasting month of Ramadan, when consumption soars.

Islamabad suspended trade and diplomatic ties with India in 2019, when Jammu and Kashmir was made into a Union Territory. It was expected that the resumption of import of these goods will lead to a partial revival of bilateral trade relations, which were suspended after the August 5, 2019 decision of India to revoke the special status of Jammu and Kashmir.