The Government of India will be reducing tax on sensitive goods by 20% as per the agreement signed by the Indian members of South Asian Association for Regional Cooperation (SAARC), under the South Asian Free Trade Area (SAFTA).

The Union Commerce and Industry Minister Anand Sharma stated that it was time when India should be backing the aim of formulating economic incorporation. Mr. Sharma revealed his views and plans of the Government in a conference organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) and Ministry of External Affairs (MEA).

India is looking forward to reduce the peak tariff on goods being imported from Pakistan by 8%. The rates will be imposed from the beginning of 2012, as per the decisions taken by the authorities in a meeting on India-Pakistan Joint Working Group on Economic Commercial Cooperation and Trade Promotion.

Also, Pakistan has ensured that they will try their best to meet the basic guidelines of the SAFTA. As per Mr. Sharma, “India is keen to engage more with Pakistan and develop deeper economic linkages. That will give more depth and width to our relationship”.

India’s worldwide business has increased to $600 billion, but the business deal with SAARC has been commenced at an amount of $13 billion.