NEW DELHI: In a bid to strengthen trade ties with neighboring countries, commerce and industry minister Anand Sharma said on Friday that India would welcome investments from Pakistan. A year after the two countries mutually decided to improve trade ties, Sharma said India and Pakistan have already achieved breakthroughs that were earlier even difficult to contemplate.
"We have allowed investments from Pakistan, whatever it be, to come to India. We know that it will not be a big amount," Sharma said.
The minister said that engagement with Pakistan was a well thought-out step last year as without Pakistan, the South Asian Free Trade Agreement ( SAFTA) would not move forward. Improving trade ties with Pakistan is critical for South Asia integration, the minister said at a Ficci conference here.
With uncertain economic environment in traditional markets like US and Europe, Sharma said India could not wait for demand to return to pre-crisis levels in these developed countries and has to look at markets where robust growth is taking place.
"Moving ahead we have to encourage an environment for investments. Now is the time when even China will be looking at investing in other emerging economies, especially India. We will be welcoming Chinese investment in India too," he said.
While the commerce minister said he is not happy with the growth of 5.3% in India's GDP last quarter, he said the reason for the low growth is the global economic slowdown which India is clearly not insulated from. "We cannot be decoupled from what is happening in the world. India cannot grow in isolation," he said.
With enlargement of the scope of tax benefits on imported inputs to include locally sourced goods and extension of interest subsidy scheme on labour intensive exports announced in the annual supplement of the Foreign Trade Policy on Tuesday, Sharma said he is hopeful the measures would benefit exporters. India is on course to achieve the $500 billion exports target by 2013-14, he added.
In light of the growth prognosis for the current year gloomier than last year, Sharma said the government has to focus on policies that have a mid-term or long-term objective and not just address daily volatility in the markets.