Pakistan U-turns on resuming trade with India, says New Delhi must restore special status of disputed Kashmir first

The decision to allow imports of sugar, cotton and wheat from India, seen as a sign of thawing in relations between Islamabad and New Delhi, has been deferred by Pakistan and tied to the status of the disputed Kashmir region.

Just a day earlier, the Pakistani government’s economic committee had said that limited imports of cheaper items from India would be approved in a bid to tackle high inflation and shortages of some essential goods amid the harsh economic climate sparked by the Covid-19 pandemic. 

Islamabad suspended trade and diplomatic ties with India in 2019 in response to New Delhi’s move to revoke the special status, or limited autonomy, of the Muslim-majority region of Kashmir, which is disputed between the two neighboring nuclear powers.

However, when Pakistani ministers gathered on Thursday for a meeting on Indian imports, chaired by PM Imran Khan, the political element came to the fore.

The decision to resume trade with India has now been postponed until it restores Kashmir’s special status, Pakistani Foreign Minister Shah Mahmood Qureshi announced after the session.

“There was a discussion on this and there was a unanimous opinion among everyone, including the prime minister, that it will not be possible to normalize relations with India till India reviews the unilateral steps it had taken on August 5, 2019,” Qureshi pointed out.

His words were echoed by several other cabinet members, with Interior Minister Sheikh Rashid Ahmed also saying the move was “deferred till Article 370 [which gave Kashmir its autonomy]” is restored, but that before then, there won't be any imports of Indian cotton or sugar.

New Delhi had previously rejected Pakistan's complaints over the region’s status, insisting that it was an internal Indian matter.

However, there were recent signs of rapprochement between the neighboring states who engaged in military skirmishes in early 2019 with shelling and aerial dogfights across the border.

Khan and Indian PM Narendra Modi have just exchanged letters stating that their nations were interested in a peaceful and productive relationship with each other. The two states also resumed talks last week on the use of Indus River resources, which runs through both Pakistan and India.

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