India has allowed investment from Pakistan

In a major decision, India has allowed investment from Pakistan paving way for Islamabad to normalise bilateral economic ties by implementing much-delayed Most Favoured Nation (MFN) status for New Delhi.

"The Government of India has reviewed the policy...and decided to permit a citizen of Pakistan or an entity incorporated in Pakistan to make investments in India," the Commerce and Industry Ministry said in a press note in New Delhi on Wednesday.

However, strategic sectors of defence, space and atomic energy have been kept out of foreign direct investment (FDI) from Pakistan, it said.

Also, the FDI proposals from the neighbouring country would need clearance from the Foreign Investment Promotion Board (FIPB).

Hailing the decision, the Indian industry said that Pakistani businessmen can explore sectors like cement, textiles and sports for investments in the country.

"It is a great decision...Now Pakistan should also implement the MFN status to India," Ficci Secretary General Rajiv Kumar said.

SAARC Chamber of Commerce & Industry President Vikramjit Singh Sahney termed the decision as one of the strongest confidence building measures to improve bilateral relations.

"Pakistan should also take similar steps and allow Indian businessmen to invest in their country," CII Director General Chandrajeet Banerjee said.

Although Pakistan had notified granting the MFN status to India in March this year, it is yet to implement it fully.

However, Pakistan had partially liberalised its trade regime with India in March when it shifted from positive list rules to negative-meaning barring 1209 items Islamabad would allow import of all other Indian goods.

Analysts feel that Wednesday’s decision would help the Pakistan government to convince the MFN opponents about its trade bargains with India.

India had granted the MFN status to Pakistan way back in 1996 which means that Islamabad will give treatment to Indian imports at par with its other trading partners.Pakistan welcomes Indian decision to allow Pakistani direct foreign investment in India. 

Pakistan terms the Indian decision to allow Pakistani direct foreign investment in India as a positive step.

Pakistan has termed the Indian decision to allow Pakistani direct foreign investment in India as a positive step.In a statement Foreign office welcoming it said that Pakistan will take up the decision according to the rules and regulations of the country. Earlier‚ India decided to allow foreign direct investment from Pakistan in a move to boost bilateral economic relations.An official statement issued in New Delhi said the government after reviewing the policy has decided to permit a citizen of Pakistan or an entity incorporated in Pakistan to make investments in India in sectors and activities other than defence‚ space and atomic energy.