(Photo by Luis Ascui/Getty Images)

PAKISTAN lifted a nearly two-year old ban on Indian sugar and cotton imports, government sources said, a step towards reviving suspended trade between the two nuclear-armed neighbours.

Pakistan’s Economic Coordination Council, a top decision-making body, on Wednesday (31) allowed the private sector to import 0.5 million tonnes of white sugar as Islamabad tries to keep soaring domestic prices in check, government officials said.

Pakistani buyers have already started making inquiries about buying Indian sugar and cotton, which is being offered at lower prices than supplies from other countries, five dealers said.

“Enquiries for sugar and cotton are going on for price checking,” said the India head of a global trading firm, who declined to be identified due to company policy.

Pakistan has been looking to tap the international market for sugar, floating two tenders for 50,000 tonnes in the last month. It rejected bids on both tenders in March.

The first tender offer was priced at $540.10 per tonne on a cost and freight basis (C&F) and the second at $544.10 tonne, European traders said.

India is offering sugar at a discount compared to supplies from Thailand, said a dealer with global trading firm.

“Pakistani traders have been buying Indian sugar through their offices in Dubai for Afghanistan. If Pakistan allows imports from India, they will unload shipments in Pakistan,” the dealer said.