Tuesday, May 16 2006 15:48 Hrs (IST) - World Time -

Islamabad: Maintaining that the SAFTA agreement could not bind it to grant the Most Favoured Nation status to India, Pakistan has said it would continue to trade with the neighbour with a positive list until there was progress on Kashmir and other issues.

Pakistan Commerce Secretary Syed Asif Shah made the remarks in response to recommendations made by a World Bank report which suggested that Islamabad should grant MFN status to New Delhi followed by a Free Trade Agreement to tap the 'enormous potential' of business and trade that existed between the two countries.

"SAFTA could not bind Pakistan to grant MFN status to India. Pakistan would continue trade with India through positive list until further progress in the composite dialogue," he was quoted as saying by the Dawn here.

Shah, however, said the expansion of the positive list was under consideration of the government. Reports here yesterday said that Pakistan plans to add 100 more items to the positive list for trade to make the products permissible for imports from India to 882.

Unveiling the report at a seminar in Karachi yesterday, World Bank's official in Pakistan Zareen F. Naqvi, said Pakistan should grant MFN status to India and follow it up with a FTA with New Delhi.

"If it is politically not palatable, then Pakistan should replace its current positive list with a negative list and restrict a minimum number of goods banned for importing from India," she was quoted in the media here as saying.