NON-TARIFF BARRIERS

TO TRADE IN PAKISTAN

MANSOOR AHMAD BAJWA

In This Presentation

 Definition of NTBs
 Invisible Trade Barriers
 Tariff Barriers in Pakistan
 Non-Tariff Barriers in Pakistan
 Private Sector’s Views on NTBs
 Conclusion
 Recommendations
Definition of NTBs

Non-Tariff Barriers include all

measures, other than tariffs, that
are used to protect domestic
industry and discourage imports
Invisible Barriers to Trade

 Non Transparent and cumbersome

Administrative Procedures and Government
Policies and Regulations
 Market Structure
 Institutional Factors
Tariff Barriers in Pakistan

 Max. duty is generally 25% but with many

exceptions (e.g. Agri. Products)
Non Tariff Barriers in Pakistan

 Lack of information:
Entry of new firms into trading with Pakistan
indicates anonymous entry into trading which is
facilitated by modern modes such as the internet.
 Lack of Adequate Banking Relations:
Some Indian banks do not recognize L/Cs from all
Pakistani banks. Moreover payments through Asian
currency union are delayed.
Non Tariff Barriers in Pakistan
contd.

 Application of standards:
Barriers are often encountered in the
application of measures related to standards necessary
to protect human, animal or plant life or health, to
protect environment and to ensure quality of goods
 Visa Restrictions:
Visas can be obtained only for specific
cities prior to entry into Pakistan
Non Tariff Barriers in Pakistan
contd.

 Communication Problems:
Whenever there are disturbances at the
Indo-Pak border, the mobile connections are not
operational.
 Trade Logistics:
Goods move by air, sea, and rail between
India and Pakistan . While road routes for trade
are non-existent, rail and air connectivity between
the two countries has been erratic.
Private Sector’s Views
 Political uncertainty, instability and mistrust
between the two countries
 India cannot be viewed as reliable and long-run
market for both imports and exports
 Pakistani consignment are subject to more
stringent checking and detailed security checks in
India (e.g. Pakistani Molasses is allowed in 1 ton
packs only because of security reasons)
 Visa and travel restrictions, one port of entry and
exit
Private Sector’s Views
contd.
 Closure of land routes (Wagha, Khokrapar, and
Ganda Singh Wala (near Kasur) is also seriously
hampering trade with India
 There is higher port congestions, higher port and
demurrage charges, more paper work, and generally
more issues of trade and transport facilitation in
Pakistan
 Lack of banking facilities of each other’s bank is also
mentioned as a barrier to trade with India
CONCLUSION
 Pakistan is the least protected economy in
south–east Asia.
 Tarifs used to be high in the past but now
in non agricultural products max. tariff is
25%.
 Tariffs applied ad velorem
 There is no accredited laboratory in the
country. Now such laboratories are being
established with the assistance of the world
bank and Asian development bank.
Recommendations
 There should be no quantitative restriction in
the guise of security reasons (e.g. restriction
on Molasses)
 Pakistan is exporting food and agri. products
all over the world, India should accept SPS
certificate issued by Pakistani authorities
Recommendations
contd.
 There cannot be a single bullet solution to deal with
the most complicated issues between the two countries.

 Businessmen should be allowed visas without

restrictions on number of cities
 Pakistan should ask India to compensate for the
benefits that it gets from Afghan-transit facility by
allowing e.g. transit facility to Pakistan for Bangladesh
via Bombay
Recommendations
contd.

 Strengthen institutions dealing with trade defense

and related issues (e.g. NTC and CBR)
 Expedite the process of opening up of Bank
branches
 Insist on opening up of land routes for trade
 Pakistan has to be very cautious as the Indian
trade regime is very complicated and non-
transparent
Thank You