India and Pakistan started the cross-LoC trade in 2008, more as a confidence-building measure. India and Pakistan started the cross-LoC trade in 2008, more as a confidence-building measure.

TWO MONTHS after India withdrew the Most Favoured Nation (MFN) status to Pakistan, following the terror attack in Pulwama, the Union Home Ministry Thursday decided to “suspend” cross-Line of Control (LoC) trade with officials alleging “misuse” of the facility by those linked to terror outfits across the border.

“Government of India has decided to suspend the LoC trade at Salamabad and Chakkan-da-Bagh in Jammu and Kashmir with immediate effect. A stricter regulatory and enforcement mechanism is being worked out and will be put in place in consultation with various agencies. The issue of reopening of LoC trade will be revisited thereafter,” the Home Ministry said in a statement.

Explained Not just trade, bid to corner Pak After the Pulwama attack, India withdrew the Most Favoured Nation status to Pakistan. Amid the poll season, the suspension of cross-LoC trade is being projected as a muscular and aggressive way to further corner Pakistan. But with average trade volume around Rs 500 crore per year, the move will have only a marginal impact economically.

“It has been brought out that a significant number of trading concerns engaged in LoC trade are being operated by persons closely associated with banned terrorist organisations involved in fuelling terrorism/separatism. Investigations have further revealed that some individuals, who have crossed over to Pakistan, and joined militant organisations have opened trading firms in Pakistan. These trading firms are under the control of militant organisations and are engaged in LoC trade,” it said.

An MHA spokesperson said the government has been “receiving reports that the Cross LoC trade routes are being misused by Pakistan-based elements for funnelling illegal weapons, narcotics and fake currency, etc”. Officials said the government was acting on reports from the National Investigation Agency (NIA) and the Intelligence Bureau (IB) that in order to evade “the consequent higher duty (after the MFN status was lifted), cross-LoC trade is likely to be misused to a much larger extent by Pakistan”.

On Friday, 35 trucks carrying fruit were scheduled to cross over to Pakistan-occupied Kashmir (PoK) from Poonch, said Fareed Kohli, custodian, LoC Trade. “However, these will not be allowed to cross the LoC tomorrow in view of the Home Ministry order,” he said. The mainstream political parties in J&K described the decision as “regressive” and “unfortunate”.

India and Pakistan started the cross-LoC trade in 2008, more as a confidence-building measure. Since then, according to the J&K government, the trade volume had touched Rs 5,000 crore by March 2018.

As many as 21 products, including red chili, cumin, tamarind, bananas, mango, dry dates and dry fruits are listed for exchange between J&K and PoK in the trade that is conducted from Tuesday to Friday every week. Initially, 646 traders from J&K were registered to trade, but less than 300 were actually involved in conducting business.

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Since March 8, cross-LoC trade from Uri was suspended with officials citing repair work on the Kaman bridge to Muzaffarabad. In the past, the trade was suspended temporarily because of inclement weather or occasionally because of ceasefire violations, including the longest spell of four months in the wake of Pakistani shelling after the killing of Hizbul Mujahideen commander Burhan Wani on July 8, 2016. It has survived spells of India-Pakistan tensions, including diplomatic stand-offs following the terror attacks in Mumbai, Pathankot and Uri.

Speaking to The Indian Express, G Parthasarathy, the former Indian envoy to Pakistan and one of the original movers of cross-LoC trade, said: “It was opened at a time when Prime Minister Manmohan Singh was of the view that borders should become irrelevant. The vision is that you should always keep trade and travel open. But I can understand the reasons of the government, which is apprehensive of the influx of hawala money through the trade route as well as increased infiltration as the snow melts. If terrorism ends, you can have soft borders.”

In 2015-16, the NIA had recommended closure of cross-LoC trade routes but the PDP-BJP government led by Mehbooba Mufti prevailed over the Centre against any such closure.

“Reports have been received that the LoC trade is being misused on very large scale. It has been revealed that the trade has changed its character to mostly third party trade and products from other regions, including foreign countries, are finding their way through this route. Unscrupulous and anti-national elements are using the route as a conduit for hawala money, drugs and weapons, under the garb of this trade,” the Home Ministry spokesperson said.

Another official cited the recent NIA probe against separatist leaders. “Proceeds from trade across the LoC are being used to finance terrorist activities in the Valley,” the official said.

Meanwhile, former chief minister and NC vice president Omar Abdullah said in a series of tweets that the Centre has “sacrificed” the “legacy” of former prime minister A B Vajpayee.

“Sadly Vajpayee Sahib’s legacy of cross LoC CBMs & the resolution of the Kashmir issue within the framework of ‘insaniyat, jumhuriyat & Kashmiriyat’ is being sacrificed at the altar of opportunistic populism,” Abdullah tweeted.

“The Modi Govt buries another of the Vajpayee era CBMs. Cross LoC trade was a legacy of the Vajpayee Govt decision to facilitate greater people to people contact across the Line of Control in J&K,” he posted on Twitter.

“That the LoC trade may have been used by some traders for illegal activities was suspected for years now & it was to plug this that the state has been pleading for the installation of full truck scanners at the trade points,” he posted. “Rather than install the scanners the Govt has taken the regressive & highly unfortunate step of throwing the baby out with the bath water. Instead of saving the CBM they’ve decided to abandon it”.

Former chief minister and PDP president Mehbooba Mufti accused the BJP of using Kashmir as “a scapegoat” to get back to power.

“Using Kashmir as a scapegoat to claw its way back to power won’t help BJP. It’s an excuse to worsen ties with Pak despite their peace overtures. By doing this PM Modi has dismantled a CBM initiated by Vajpayee ji. Won’t be surprised if an attack on Pak is in the offing,” she tweeted.

Speaking to The Indian Express, Peoples Conference chairman Sajad Lone said. “It is one step forward, two steps back. It is a regressive step. It was initiated as a confidence building measure at that time and now it is a confidence shattering measure”.

(With Shubhojit Roy in New Delhi & Arun Sharma in Jammu)

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