| GEO Business|
| EU to propose tariff cuts for goods from Pakistan|
| Updated at: 1023 PST, Saturday, April 24, 2010|
BRUSSELS: The European Commission is moving to give Pakistan tariff-free access to the European Union for its exports, part of an EU effort to bolster the economy of the strategically important country, EU diplomats said.
The commission's proposal, which is still being discussed internally, is part of the EU's military and diplomatic project for Afghanistan. EU governments, led by the U.K., view economic growth and stability in Pakistan--where a number of the militant groups fighting coalition forces in Afghanistan are based--as crucial to fighting terrorism and drug smuggling in Afghanistan.
The proposal would change an EU program that gives tariff-free access to EU markets for poorer countries. Pakistan currently doesn't qualify for the program, known as the Generalized System of Preferences +, because its exports represent too high a proportion of total EU imports.
The commission plan would allow countries that account for up to 1.5% of total EU imports to qualify for GSP+, up from the current threshold of 1%, EU diplomats say.
Pakistan's exports, largely textiles, now account for about 1.4% of imported EU goods that qualify for the GSP+ program, an EU diplomat said.
Pakistan would also have to agree to sign several international treaties, including one on human rights, to qualify for the program.
The EU and Pakistan were supposed to hold a summit this week in Brussels, but the meeting has been postponed due to flight cancellations caused by the volcanic ash cloud.
The changes would take effect in 2012 and will need to be approved by EU national governments at the European Council and the European Parliament.