Pakistan WTO Issue

To be read along with the WTO Primer in the package:

India ,Bangladesh and Peru have opposed the European Union's proposal to give duty free access to Pakistani textiles as a flood relief measure . The countries have informed the World Trade Organisation (WTO) that trade concession was not the right option as it harmed interests of competitors. India fully supports EU's intention of helping Pakistan in its time of need, but assistance should be given directly in cash or kind and not by bending trade rules

A decision on EU's proposal to allow duty-free import of 75 items for three years starting January 2011, amounting to almost euro 900 million in import value -- 64 of them textiles -- from Pakistan was deferred at a recent meeting of the WTO committee on trade in goods after the three countries raised objections. EU can give concessions to Pakistan only if the WTO gives it a waiver from its obligation of treating all member countries the same way, under a provision known as the most favoured nation (MFN) clause.

Although India's garments and textiles exports to the EU in 2009 at $5.9 billion was more than double Pakistan's $2.2 billion, it could lose a market share to its neighbour if duty-free access is allowed as import duties range between 6% and 12%.