Govt shuts down cross-LoC trade with Pak-occupied Jammu & Kashmir

Ministry of Home Affairs on Thursday issued an official statement to suspend trade with Pakistan-occupied Jammu and Kashmir which will go into effect from tomorrow (April 19).

The action has been taken as the government has been receiving reports of cross-LoC trade routes being misused by Pakistan-based elements for funnelling illegal weapons, narcotics and fake currency.

It may be recalled that the LoC trade is meant to facilitate exchange of goods of common use between local populations across the Line of Control (LoC) in Jammu and Kashmir.

The trade is allowed through two Trade Facilitation Centres located at Salamabad and Uri in Baramullah and Chakkan-da-Bagh in Poonch.

The trade takes place four days a week. The trade is based on barter system and zero duty basis.

However, this facility was being misused by some influential local businessmen in nexus with unscrupulous elements to trade in products from third countries.

Hence, the government has suspended the cross-LoC trade at Salamabad and Chakkan-da-Bagh in Jammu and Kashmir.

The NIA had registered a case on cross-border LoC trade in regards of terror funding in December 2016. The case, where the main complainant was the Home Ministry itself, is still under investigation, after a span of nearly two and half years.

In a statement, the Ministry of Home Affairs said, "During ongoing probe of certain cases by NIA, it has been brought out that significant number of trading concerns engaged in LoC trade are operated by persons closely associated with banned terror organisations involved in fueling terrorism/separatism."

The ministry also said, "So, it has been decided to suspend LoC trade at Salamabad and Chakkan-da-Bagh in Jammu and Kashmir. Meanwhile, stricter regulatory and enforcement mechanism is being worked out which will be put into place after consultation with various agencies."

"The issue of reopening of LoC trade will be revisited thereafter," the ministry said.

After the Pulwama incident, the Government of India withdrew the Most Favoured Nation (MFN) status to Pakistan. Inputs have also been received that in order to evade the consequent higher duty, LoC trade is likely to be misused to a much larger extent.

(Inputs from Kamajit Kaur Sandhu)