India fires free trade salvo ahead of peace talks with Pakistan

NEW DELHI, Nov 7, 2006 (AFP) – India’s foreign minister Tuesday accused regional adversary Pakistan of placing hurdles in the way of a fledgling South Asian Free Trade Agreement (SAFTA). Foreign Minister Pranab Mukherjee warned that a regional free trade agreement reached in January 2004 and implemented earlier this year could collapse if Islamabad failed to fully implement key tariff cuts.

“The tariff reduction negotiations have been completed and operationalised from January 1,” he told a forum, adding he hoped to convince Pakistan to remove hurdles during two days of talks between foreign secretaries.

Peace talks between the rivals resume November 14 after they were placed on hold following July train bombings that killed 186 people in India’s financial capital Mumbai.

India said the bombers had links to Pakistan’s spy agency, a charge denied by Islamabad.

“Our trade with Pakistan is on the basis of a positive list but Islamabad says that it is not free trade and recently expanded the basket by adding 78 items,” Mukherjee said.

“But I am not interested in the number of items. I am interested in seeing that the obstructions, which are there, are removed and there sh