ISLAMABAD: The World Bank has said Pakistan will benefit from granting the Most Favoured Nation (MFN) status to India.
The World Bank also suggests the two countries sign power transmission and trade agreements.
The 293-page World Bank document Pakistan the Transformative Path presents a possible list of the 12 most urgent transformational reforms required to be taken by the Nawaz Sharif government and include the MFN status for India, the import of electricity from India, among others, The News reported.
On August 20, the World Bank had announced that it had put together a Country Economic Memorandum and 16 sector-specific Policy Notes for the Sharif government to consider.
Ignoring the tensions as well as the complexities of the irritants, the World Bank suggested to Islamabad: “Completing the trade normalisation process with India and granting it the MFN status would help Pakistan benefit quickly from the fast growth and large markets,” the report said.
“Conservative estimates suggest that bilateral trade flows could multiply at least three times, and most observers agree that the growth-enhancing dynamics that this process would unleash would be even more significant for foreign direct investment (especially information technology and manufacturing), services (including financial and tourism), integrated value chains in manufacturing, and power projects,” the Policy Note said.
The document says, “A power transmission link with India, under a power tariff arrangement benefiting both countries, could be implemented in the next 6-12 months with a potential capacity of 1,000 megawatts.”
Pakistan has shown interest in buying power from India, with its team visiting some power plants of the country last month in this regard. The World Bank Policy Notes for the Sharif government also stresses on removing impediments at the border, especially Wagah-Attari, and along other trade routes.
A one-stop border post at Wagah-Attari would have a large demonstration effect, as would inland container depots on either side of the border, it said.
There is also potential for transit agreements to link Pakistan to Bangladesh and Nepal, and India to Afghanistan (similar to the one negotiated between Pakistan and Afghanistan); for associated infrastructure supporting new trade routes; and for online payment systems, the media report said.
It also talked about further integrating border communities. Populations along the border regions are among the poorest in both Pakistan and India, and so integrating their communities presents particular challenges, it said.
More localised initiatives to target them, including border bazaars and other measures to encourage cross-border trade, are yet to be fully explored. Some initiatives along these lines are already in place between Bangladesh and India, the report added. -PTI
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