LAHORE: With the cessation of bilateral trade between Pakistan and India due to an ongoing escalation along the border, leading business houses said they were now contemplating a deal with the US, Afghanistan and Central Asia instead.
“Pakistan has cheaper options available for major import of cotton from the US” while cement exporters tend to look for Afghanistan and Central Asian destinations besides supplying for local consumption to meet the growing demand within the country, said Anisul Haq, secretary general of All Pakistan Textile Mills Association (APTMA) Punjab on Wednesday.
If the two countries wish to benefit from direct trade through Wagah, the trade has to be on a level playing field to reap dividends of close proximity and cheaper goods requiring lesser time to deliver consignments, Haq told Arab News. “We do not encourage a reroute of trade through other channels like the Afghan Transit Trade.”
Pakistan’s total trade volume from India, during 2017-18, stands at $2,412.80 million, including total imports worth $1,924.28 million and exports at $488.52 million, according to documents available with Arab News. The major imports from India include cotton, organic chemicals, dyes and chemicals, machinery, raw material for pharmaceuticals, etc., while major exports to India include cement, gypsum, edible and citrus fruits, mineral fuels and oils.
Following the February 14 attack on Indian troops in the Pulwama district of Indian-administered Kashmir, New Delhi had withdrawn the Most-Favored Nation (MFN) status from Islamabad and imposed a 200 percent import duty on Pakistani goods. The unilateral move by India virtually brought all bilateral trade to a halt and truckloads of cement were seen parked inside the Wagah border and returned later.
Younas Dhaga, Secretary to Ministry of Commerce, told Arab News that Pakistan would stick to its stance whereby the Adviser to Prime Minister on Commerce, Razak Dawood had said he would raise the issue of India withdrawing the MFN status at the international forum of the World Trade Organization (WTO) if the stalemate continues.
According to the State Bank of Pakistan’s annual report 2017-18, “The cotton production marked an increase from 10.7 million bales last year to 11.9 million bales in FY18. Yet, cotton production not only missed the target of 13.6 million bales, but also stood lower than the textile industry’s need of 13.2 million bales.”
Traders search for alternatives amid India-Pakistani standoff
Traders search for alternatives amid India-Pakistani standoff
- Businessmen say they prefer to look at newer options instead
- Says New Delhi stands to lose more than Islamabad if economic limitations continue
Gold rises on Iran war safe-haven bid; firm dollar limits upside
BENGALURU: Gold prices rose on March 5, lifted by safe-haven demand amid an escalating war in the Middle East, while a stronger dollar and concerns around the US Federal Reserve’s monetary policy capped gains.
Spot gold was up 0.6 percent at $5,168.43 per ounce, as of 11:55 am Saudi time. US gold futures for April delivery were up 0.9 percent at $5,179.20.
Israel launched a large wave of strikes on Tehran on March 5, targeting what it said was infrastructure belonging to the Iranian authorities, after Iranian missiles sent millions of Israelis rushing into bomb shelters.
“On the one hand, there may be greater safe-haven demand for gold given the ongoing conflict in the Middle East. On the other hand, the risk of a prolonged period of higher energy prices that takes rate cuts off the table, and adds to the chance of rate hikes, could be capping further gains,” said Hamad Hussain, a climate and commodities economist at Capital Economics.
The US dollar rose about 0.3 percent after briefly retreating from three-month highs, as the fallout from the war roiled global markets and kept sentiment fragile.
Concerns about energy supply continued to drive up oil prices and stoke inflation fears.
Gold is considered a hedge against inflation in the long run, but also tends to thrive when interest rates are lower, as it is a non-yielding asset.
President Donald Trump, on March 4, officially nominated former Federal Reserve Governor Kevin Warsh to be the US central bank’s next chair.
US economic activity grew slightly, prices continued to increase and employment levels were stable in recent weeks, the Federal Reserve said on Wednesday in its latest “Beige Book” report.
Markets expect the Fed to keep rates steady at its next policy meeting on March 18, according to CME Group’s FedWatch tool.
Investors are looking out for the weekly US jobless claims data, due later today, and the US employment report for February on March 6 for further clues on monetary policy this year.
Spot silver rose 0.5 percent to $83.80 per ounce. Platinum gained 1.1 percent to $2,172.20, while palladium lost 0.7 percent to $1,662.07.
