Pakistan denies Indian allegation on MFN status

ISLAMABAD, Nov (Agencies): Pakistan Friday denied that it had backtracked on giving India most favoured nation (MFN) trade status. "Pakistan is not backtracking," said foreign office spokeswoman Tehmina Janjua after a senior Indian official earlier said the nuclear-armed rival was bowing to domestic business interests opposed to finalising MFN status. "Pakistan clearly stated that our cabinet gave approval to move forward on MFN status in principle," she said. The MFN status would help normalise trade relations between the two nuclear-armed rivals by ending heavy restrictions on what India is allowed to export across the border. New Delhi granted its neighbour such a status in the mid-nineties. Last Wednesday's announcement was trumpeted on both sides as a milestone in improving fragile relations. Lasting peace between the two countries is seen as key to stability in the South Asian region and help a troubled transition in Afghanistan as NATO-led forces plan their military withdrawal from that country. Pakistan's decision to initiate the process of granting most favoured nation (MFN) status to India is "a very big deal" and could lead to great economic opportunities between the two countries, the US said. "We don't yet have most favored nation status, but what we do have and we are very pleased to see happen is, we have a decision, unanimously approved by the Pakistani Cabinet, to open a path for full normalisation of trade relations with India, as agreed in the meeting between the Indian and Pakistani commerce ministers in Delhi this September, which will, in turn, we hope, lead to most favored nation status," State Department spokesperson Victoria Nuland told reporters. "This is a very, very big deal, very important; could lead to really great economic opportunities for both India and Pakistan; sets the kind of example within the Silk Road family that we would like to see throughout that region," Nuland said in response to a question on this issue. "We'd like to see the opening of trade relations because this will bring prosperity to everybody, break down old barriers, really lift all boats in the region and make the region even more vital as a center of global commerce," she said.