India and Pakistan to release joint statement today
New Delhi: Talks between the Pakistan President Pervez Musharraf and Prime Minister Manmohan Singh lasted for over two hours last evening. It is believed that the two sides have agreed to put various initiatives between the two countries, on the fast track.

India and Pakistan have agreed that there can be no time frame imposed for resolving the Kashmir dispute. The two countries have agreed to intensify talks to demilitarize Siachen. A common ground is also being sought to boost travel, trade and business ties.

Discussions have also been held about energy sources including the proposed oil pipeline from Iran through the Pakistani territory.

On Baglihar, Pakistan has expressed its concern that water may be used as a weapon. In return, the Indian Prime Minister has assured Pakistan that the Indus Water Treaty will not be violated.
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India maintains fourth largest economy status on PPP terms
Washington: India has retained its position as the fourth largest economy in the world on the basis of Purchasing Power Parity (PPP), behind the United States, China and Japan.

On PPP terms, the size of the economy is calculated according to what a nation's currency actually buys in goods and services, and not on the basis of its exchange rate against the US dollar.

The United States has by far the largest economy in the world worth $10,978 billion, followed by China at $6,410 billion, Japan at $3,629 billion and India with $3,062 billion. Germany comes next with $2,279 billion.

France, Italy, the UK, Brazil and Russia are other countries above the $1,000-billion mark.

With a PPP per capita of $2,880 dollars, India is above the definition of a low income country (per capita PPP income of $2,110 or below) but falls below the required $6,000 PPP per capita to qualify for being a middle income country.

The developing countries have asked for quotas or shareholding in the IMF and the World Bank decided on the basis of Purchasing Power Parity.

However, managing director of the International Monetary Fund Rodrigo de Rato said on Saturday that such a decision would be a political one, suggesting it may not happen.
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Pak minister: Munnabao-Khokrapar train service by Dec. 31
Islamabad: The Munnabao-Khokrapar train service between India and Pakistan would begin by December, the Pakistani Minister for Railways Shamim Haider has said. The issue has figured prominently in talks between visiting President Pervez Musharraf and Prime Minister Manmohan Singh in New Delhi today, reports have suggested.

According to the minister, the Munnabao-Khokhrapar train service between Rajasthan and Sindh province would start by December 31. The repair work of Munnabao-Khokhrapar railway track is in progress and would be completed at a cost of Rs1.25 billion, a news agency quoted him as saying.

Officials said Pakistan railways have set up a special team to complete the project in time.
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India and Pakistan to set up Joint Business Council
New Delhi: In a major step towards boosting bilateral economic ties, India and Pakistan have decided to set up a Joint Business Council (JBC).

Islamabad has also indicated that it may move forward towards giving Most Favoured Nation (MFN) status to New Delhi. This was the outcome of a forty-minute meeting between Commerce Minister Kamal Nath and his Pakistani counterpart Humayun Akhtar Khan. The Chambers of the two countries would meet now to work out the nitty gritty of setting up the Council.

The meet was held on the sidelines of Summit level talks between Prime Minister Manmohan Singh and Pakistan President Pervez Musharraf.

Nath also announced that at the directive of Singh, New Delhi has agreed to lift any "perceived" non-tariff barriers coming in the way of Pakistani trade to India. The two ministers also agreed that the Joint Study Group (JSG) that has already been established between the two countries would meet in June to sort out specific difficulties coming in the way.
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India Inc. welcomes initiatives to widen trade ties with Pakistan
New Delhi: The Indian industry has welcomed the measures announced by India and Pakistan for strengthening the trade-ties and has said that the initiatives could boost bilateral trade to the tune of $5 billion by 2006.

Terming the setting up of the JBC as a 'milestone' in the economic relation between India and Pakistan, the President of the Federation of Indian Export Organisations (FIEO), O.P. Garg, said opening up of traditional transit route through Central Asia would give a boost to Indo-Pak trade and South Asia, Central Asia and Gulf. He hoped that Pakistan would grant the 'most favoured nation' (MFN) status to India and that the two countries would sign a preferential tariff agreement shortly.

Onkar S. Kanwar, President, FICCI, said the JBC should focus on four areas including opening up trade (exports) from India to Pakistan across a large number of sectors, which is at present limited to 768 items.

"Instead of a small positive list (768 items) which the Pakistan Government currently allows for trade, there should be a negative list from their side of sectors that they may wish to protect and all other sectors must open up for trade.

This has become a stepping-stone to the grant of MFN.

"Second, now that the Governments of India and Pakistan are supporting greater people-to-people interaction, it is time to open a few select sectors for joint ventures between the two countries which would increase employment and income opportunities and directly contribute to the greater industrialisation of Pakistan through Indian partners," the FICCI said.

Highlighting that infrastructure facilitation was critical for trade and investment to prosper, the FICCI said a road route through the Wagah Border through custom-bonded warehouses on either side of the border on the pattern of Indo-Bangladesh trans-shipment across Petrapole should multiply trade manifold.

FICCI said that the JBC should also focus on the trade in services, which can emerge as huge potential area.

"Already, the two countries are together committed to the South Asia Free Trade Agreement, which is due to start in 2006.

"Under the bilateral FTA, India and Pakistan can move faster towards a tariff free regime and together take advantage of third country's exports by enhancing competitiveness of core sectors," it added.

According to the Assocham President, Mahendra K. Sanghi, the Commerce and Industry Ministers of the two countries should involve the participation of Indian industry in adequate numbers in the JBC. The governments of India and Pakistan should further intensify their talk to restore and set up transportation linkages by bus or railways between the agreed spots.
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UP declines to move to VAT soon
New Delhi: Uttar Pradesh has declined to switch to VAT in the "immediate future".

Uttar Pradesh Agriculture Minister Ashok Bajpai has told the Empowered Committee that UP will not shift to VAT until the traders in the state agree to do so. But the minister did not specify a timeframe by when UP would be able to persuade its traders on VAT.

Traders, particularly the small ones, fear that VAT could increase their problems.

At present, UP has five lakh registered traders. This number could rise to 25 lakh if the state switches over to VAT, according to Bajpai.
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