India for economic partnership with Pakistan

General view of stands offering textiles for sale during the inaugural day of 'Lifestyle Pakistan' in New Delhi on April 12, 2012. —AFP

NEW DELHI: India and Pakistan said Thursday they hoped to transform trade ties and boost peace prospects at the opening of the largest Pakistani commercial fair ever staged on Indian soil.

“There is no other option but economic partnership between Indian and Pakistan,” Indian Commerce Minister Anand Sharma said at the launch of the four-day exhibition in New Delhi, a sentiment echoed by Pakistani officials.

“We have to recognise our true trade potential and leave our children with a legacy that ensures prosperity, harmony and peace.”

The opening came just days after Pakistan President Asif Ali Zardari made the first trip to India by a Pakistani head of state in seven years.

Pakistan has brought more than 650 business people to the Indian capital for the trade show as commercial ties improve between the neighbours.

The two countries have approved a most-favoured-nation accord, reducing taxes that hamper trade.

Official two-way trade of around $2.6 billion is heavily tilted in India’s favour but unofficial trade is estimated at around $10 billion.

The show underscored hopes voiced by the two nations that boosting trade can help the peace process.

“(A) lot of movement has happened in the past year, normalisation is going very fast,” Pakistan Commerce Secretary Zafar Mahmood said.

The fair showcases the products of Pakistan’s top jewellery, furniture and clothes designers along with the goods of leading food producers.

“We have the top brands of Pakistan, the high-end fashion and creative work in this show,” Tariq Puri, chief executive of the Trade Development Authority of Pakistan, said.

“We have never had so many quality people under the same roof.”

The Pakistani lifestyle exhibition in New Delhi follows a successful “made-in-India” trade show in the Pakistani city of Lahore in February.

Energy costs stir worries in U.S. economic expansion

Kenny Sharrar pumps fuel into his truck at a Chevron gas station in Buckeye, Arizona October 27, 2011.

Credit: Reuters/Joshua Lott

By Glenn Somerville

WASHINGTON | Wed Apr 11, 2012 4:01pm EDT

WASHINGTON (Reuters) - U.S. economic activity kept growing moderately in the late winter months but rising energy prices were beginning to worry manufacturers and retailers across the country, the Federal Reserve said on Wednesday.

"Reports from the 12 Federal Reserve districts indicated that the economy continued to expand at a modest to moderate pace from mid-February through late March," the central bank said in its latest "Beige Book" summary of national activity.

Positive signs, it said, included stronger manufacturing activity, steady hiring and improved retail business in much of the country. But overlying that was a sense of concern that costlier energy and rising gasoline prices were a threat.

"While the near-term outlook for household spending was encouraging, contacts in several districts expressed concerns that rising gas prices could limit discretionary spending in the months to come," it added.

The report, based on data collected before April 2, comes from business contacts in each of the 12 districts that have regional Fed banks and is thus seen as a real-life complement to the more academic speeches and analyses that flow from the central bank.

Its description of growth at a "modest to moderate pace" was unchanged from the prior summary issued at the end of February. But coming after last week's government report showing only 120,000 jobs created in March, the fewest since October, it sounded a bit more upbeat about the job market.

"Hiring was steady or showed a modest increase across many districts," it said. "Difficulty finding qualified workers, especially for high skilled positions, was frequently reported."

Fed policymakers will use the information to assess the economy when they meet April 23-24 to consider whether to change interest-rate policy.

Atlanta Fed Bank President Dennis Lockhart, a voting member of the policy-setting Federal Open Market Committee, said on Wednesday he would be "somewhat reticent to consider another round of quantitative easing" at this time.

The Beige Book's caution about rising energy prices seemed to be borne out in separate Labor Department data showing imported petroleum costs were still on the rise.

March import prices climbed by the most in nearly a year on sharply higher petroleum costs, the Labor Department said.

Imported petroleum prices alone increased 4.3 percent, the biggest gain since April 2011.

That helped drive overall import prices up 1.3 percent for the biggest monthly gain since April 2011, the Labor Department added.

Economists polled by Reuters had expected import prices to rise 0.8 percent last month. February's data was revised to show a 0.1 percent decline instead of the previously reported 0.4 percent increase.

The data underscores the size of the price shock that is stinging Americans when they refuel their cars.

There are ample signs that higher gasoline prices are a weight on the U.S. economy, still burdened by high unemployment and a soft housing sector following the 2007-2009 recession.

Applications for U.S. home mortgages fell last week despite a drop in the average interest rate for 30-year mortgages, the Mortgage Bankers Association said in a separate report on Wednesday.

As for export prices, the Labor Department report showed they rose 0.8 percent last month, above analysts' expectations for a 0.4 percent gain. Export prices increased 0.4 percent in February.

Markets showed little direct reaction to any of the day's data. Stock prices were higher near the trading session's close but that followed five days of losses. Treasury debt prices were lower.

U.S. data scheduled for release on Thursday is expected to show tame price pressures at a wholesale level, with producer prices seen rising 0.2 percent in March when stripping out food and energy.

(Additional reporting by Jason Lange and Leah Schnurr in New York Editing by W Simon and David Gregorio)

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