2 November 2011
Last updated at 08:57 ET
Pakistan’s trade minister was recently in Delhi to boost ties
Pakistan’s cabinet has unanimously approved the award of “most favoured nation” trading status to India.
Pakistan had previously linked trade liberalisation with India to a resolution of the dispute over Kashmir, over which the nations have fought two wars.
Correspondents say the move is a significant step towards boosting the peace process between the neighbours.
India has already extended most favoured nation status to Pakistan.
The status typically reduces tariffs and increases import quotas.
Bilateral trade is currently put at about $3bn (£1.87bn) and the two sides agreed at a recent meeting in Delhi to double that within three years.
Although India granted Pakistan most favoured nation status in 1996, Pakistan says it has suffered from strict Indian customs rules and quality standards.
‘National interest’
Pakistan Information Minister Firdous Ashiq Awan told a news conference in Islamabad: “Today after an extensive briefing by the commerce secretary, the cabinet unanimously decided to grant India most favoured nation
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