Business upset over summit exclusion

Porters hand over goods at the border crossing

By Jyotsna Singh in Delhi

Business leaders in India and Pakistan were disappointed over the exclusion of trade representatives in the Pakistani delegation for this weekend's summit.

Pakistan could export fruit and vegetables to India

Bilateral trade has been one of the major casualties of around 50 years of hostility between India and Pakistan.

Negligible levels of commerce - combined with heavy military spending - has damaged the economies of both countries.

Official trade between the two neighbours is recorded at less than $200m a year, mainly due to various restrictions and trade barriers.

However, illegal trade and business routed through third countries is estimated to be more than $1bn a year.

Various estimates suggest that bilateral trade has the potential to grow by up to $5bn year if a policy of trade openness is followed by both the sides.

Disappointed

Trade and business people from India and Pakistan had pinned a lot of hope on the Agra summit.

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But the decision by Pakistan not to include the trade or commerce ministers in their delegation has came as a disappointment to India.

The former president of Pakistan's premier industry association in Karachi, Majyd Aziz, told the BBC that he was disappointed - but not disheartened by the news.

He said the summit itself was a major breakthrough irrespective of its outcome.

But an international trade expert in the Confederation of Indian Industries, Piyush Behel, said that Indian business lobbies would now have to abandon plans to discuss bilateral trade with the Pakistani delegation.

Trade issues

India is keen to discuss several key economic issues with Pakistan.

• It wants to be given the status of Most Favoured Nation which it has already granted to Islamabad.

• It also wants to stop illegal trade between the two countries which it describes as a mutual concern that needs urgently to be addressed

• Delhi also wants to discuss a pipeline for the supply of oil from Iran through Pakistan

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Analysts say Pakistan is expected to earn nearly $200m annually in transit fees from the pipeline.

Industry leaders from both countries say that each stands to benefit from enhanced trade.

India can export tea, raw materials, machinery, chemicals and medicines to Pakistan, whereas Pakistan can export finished products such as textiles, carpets, leather goods, fresh fruits and vegetables to India.