By Admin 
India-EU Trade Deal: The Free Trade Agreement (FTA) between India and the European Union (EU) has increased Pakistan’s tension. Pakistan fears that due to the FTA signed with India, its exports to EU may reduce.
Anyway, Pakistan’s exporters and analysts have already warned that this deal can weaken Pakistan’s position in the second largest export market because Indian products will get tariff-free access to European markets on a large scale. Due to this, the prices of Indian products will reduce, demand will increase and Pakistan’s profits will be affected. At present, Pakistan is busy reviewing the impact of the newly signed free trade agreement between India and the European Union.
Why is Pakistan worried?
According to PTI report, in the weekly press briefing, Pakistan Foreign Ministry spokesperson Tahir Andrabi said that Islamabad is aware of this agreement and is committed to its trade relations with the EU. He said, “Relations between Pakistan and the EU have been friendly and mutually beneficial for a long time. EU’s Generalized Scheme of Preferences Plus (GSP+) has proved to be a win-win model for Pakistan.
Let us tell you that under this GSP+, about 78 percent of Pakistan’s products get duty free access in 27 countries of the European Union. Pakistan is getting the benefit of EU’s GSP+ status since January 2014. Due to this, Pakistan’s textile exports to European markets have increased significantly. Pakistan fears that the immediate duty-free access to India from the FTA may reduce the tariff gap for Pakistani exports under GSP+, especially in the textile and clothing sector.
What are the experts saying?
All Pakistan Textile Mills Association (APTMA) Chairman Kamran Arshad told Pakistani newspaper Dawn that the 27 member countries of EU buy about $ 8.8 billion or 27.2 percent of Pakistan’s total exports and about $ 7 billion or 39 percent of its textile shipments every year. Now that India has achieved duty-free access on 100 percent textile and clothing tariff lines, it may increase competition for Pakistan in European markets. Shankar Talreja, Research Head, Topline Securities, says, “With the implementation of FTA, there is a danger of Pakistan losing the benefits it is getting. This may increase costs for domestic industries in the future.
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