Following India’s move to allow investments from the neighbouring country, Pakistan’s central bank has allowed two banks to open branches in India as part of efforts to normalise economic and trade relations between the two countries.
State Bank of Pakistan (SBP) Governor Yasin Anwar told the media that the National Bank of Pakistan and the United Bank Ltd had been given the “green signal” to operate in India.
Anwar’s remarks came in the wake of India’s decision to allow investments by Pakistanis in all sectors except defence, space and atomic energy. He said the Reserve Bank of India had been informed of SBP’s decision of allowing the Pakistani banks to explore opportunities in India.
India’s move to allow Pakistani investments has been welcomed by businessmen on both sides of the border. Trade between India and Pakistan is worth a little more than $2 billion and the two sides have agreed to increase it to $6 billion by 2014. Earlier this year, Pakistan switched over to a negative list regime for trade with India, paving the way for giving the Most Favoured Nation-status to the country.