T remains to be seen what impact the cancellation of the foreign secretary-level talks between India and Pakistan will have on that other large issue being discussed between the two countries: normalisation of trade ties. For the time being, it is clear that the ball is in Pakistan`s court and until a firm step is taken towards the grant of Non-Discriminatory Market Access status, meaningful progress will remain elusive. This past week, a conference held at the Lahore University of Management Sciences between academic and industry delegates from both sides saw the exchange of candid views on future directions in trade liberalisation. The discussions largely revolved around policy questions, but political realities that stand in the way of further progress were never far from the discussion the culture of enmity that engulfs the public discourse on both sides as well as the implications of a new government headed by Mr Modi.

The cancellation of the secretary-level talks might provide a glimpse into how the new government in India intends to approach the larger question of trade liberalisation with Pakistan, but actions of this sort should not hold hostage Pakistan`s decision to grant NDMA status to India.

All participants at the conference agreed that trade liberalisation between India and Pakistan is ultimately a political enterprise, and the single best path forward towards building constituencies for peace in both countries. There is weak ownership of the process amongst the business communities in India and Pakistan, and this needs to be rectified. In India, the reason for the comparative lack of interest is the paucity of the gains that India stands to reap from a trade opening with Pakistan. For the business community in Pakistan, fears of competing with their larger and admittedly more savvy counterparts in India is the cause. But this is about more than just the fortunes of a few businessmen or the limited vision of the hawks. This is about unleashing the transformative powers of trade. Towards that end, it is necessary for Pakistan`s business and policy community to understand that moving the process along is in its own interest, and a key plank in the strategy to unlock Pakistan`s locational rents. Keeping the process moving forward in spite of setbacks in other areas is the best way to signal Pakistan`s seriousness of purpose, as well as providing a reciprocal gesture of support to those holding out an olive branch from the other side.