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Pakistan to lift ban on Indian textile machinery

Pakistan said on Friday that it will soon lift the ban on import of textile machinery from India even as the ban on sugar import will continue.

"We are right now in the process of allowing your textile machinery into Pakistan. Why? Because it makes good business sense. That's why, and we would like to further this process," Pakistan's Commerce, Industry and Production Minister Abdul Razak Dawood said in New Delhi.

Addressing an interactive session organised by FICCI (Federation of Indian Chambers of Commerce and Industry) he said that at the same time last year Pakistan had removed the ban on import of textiles as part of efforts to liberalise its economy and make it more market driven.

The minister, however, clarified that the ban on import of sugar from India would continue to stay.

"The decision (to retain the ban) was taken by none other than myself, but I assure you that there was no politics of the sub-continent or politics of pressure groups operating within Pakistan. I assure you here today that the decision was purely economics," he said.

"Yes, we did stop Indian sugar from coming in because we are facing a situation of vast sugar surplus," Dawood said adding, "if tomorrow there is a shortage please send all the sugar you can into Pakistan. We have no problems".

The minister further said that if the Pakistani businessmen approached him to remove some items from the restricted list then "we will consider it and the request will be acceded to within seven days".

Despite a high demand for textile machinery, Pakistan had banned its import from India. As a consequence, it was importing the machinery from Switzerland and Germany at high costs.

Pakistan had, in July, allowed import of 50,000 tonnes of refined Indian sugar and line of credit had been opened prior to the ban on March 8 this year.

Pakistan Sugar Mills Association was against this decision as it felt imports of white sugar from India affected its own milling business.

Instead it was amenable to import raw sugar to meet domestic shortage, if any, which would also increase its own mills' capacity utilisation.

Pakistan annually consumed around 3.3 million tonnes of sugar while its production during a "bad crop year" could be as low as 2.8 million creating an export potential of 500,000 tonnes for a country like India.

But while banning imports from India, Pakistan was sourcing its requirements from Thailand.

Indian sugar costs about Pakistani Rs 21.5 per kg at the border for importers and could be sold at Rs 23 per kg in the open market.

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