Pakistan’s Cabinet, the final authority on resuming trade with India, reversed a decision by a government economic committee on Wednesday to import cotton and sugar from the neighbouring country.
The Cabinet, headed by Prime Minister Imran Khan, linked the resumption of trade with the restoration of autonomy to the region of Kashmir, interior minister Shaikh Rashid Ahmed said. Pakistan downgraded diplomatic relations and suspended bilateral trade with India in August 2019 after New Delhi revoked the autonomy for its part of the disputed territory.
The decision to start imports, aimed at addressing shortages and stabilizing prices in Pakistan, was criticized by analysts and opposition parties as a compromise on Kashmir.
The resumption of trade was seen as another sign of thawing relations between the two rivals. The nuclear-armed neighbours surprised the world last month with a rare joint commitment to respect a 2003 cease-fire agreement along a disputed border that has seen wars and regular gunfire.
The India-Pakistan cease-fire marked a milestone in secret talks brokered by the UAE, Bloomberg reported earlier this month.
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