Read the below statements marked as Assertion (A) and Reason (R). Assertion (A): Pakistan’s move from a ‘Positive List’ to a ‘Negative List’ of 1209 tariff lines for Indian goods under SAFTA was challenged by India as a violation of the agreement. Reason (R): Article 23 of the SAFTA Agreement permits member countries to make unilateral tariff reservations in case of political disagreement.

Correct — C. A is true. In March 2012 Pakistan replaced its positive list for imports from India with a negative list of 1,209 tariff lines.

India's Minister of State for Commerce told the Rajya Sabha that the shift was a derogation of SAFTA, since Article 23 permits no reservations.

R is false. Article 23 says the Agreement 'shall not be signed with reservations, nor will reservations be admitted'. It bars reservations and does not permit them for political disagreement → option (c).

Why the others are wrong

• (a)
  Both A and R are true, and R is the correct explanation of A. — R is false, so it cannot explain A. Article 23 forbids reservations, and India's objection to the negative list relied on that prohibition.
• (b)
  Both A and R are true, but R is not the correct explanation of A. — Both-true fails on R. Article 23 bars reservations, and SAFTA's permitted departures, in Articles 14 to 16, cover general exceptions, balance of payments and safeguards, not political disagreement.
• (d)
  A is false, but R is true. — A is the true half: Pakistan did move to a 1,209-line negative list, and India called it a derogation of SAFTA. R is the false statement.

A positive list names the goods that may be imported from a country, and everything else is barred. A negative list names the goods that may not be, and everything else is allowed.

Pakistan's earlier positive list for India allowed fewer than 2,000 items. The 2012 negative list barred 1,209 and opened the rest, so it was the more liberal regime even though India objected to it under SAFTA.

Key facts

• SAFTA was signed at Islamabad on 6 January 2004 and came into force on 1 January 2006.
• Article 23 of SAFTA (Reservations): the Agreement shall not be signed with reservations.
• Pakistan notified its negative list of 1,209 items that cannot be imported from India in March 2012.
• SAFTA's Articles 14, 15 and 16 provide for general exceptions, balance-of-payments measures and safeguard measures.

Common traps

• Judging R by whether it sounds like a treaty clause: Article 23 is real, but it forbids reservations rather than permitting them.
• Marking A false because the negative list was a liberalisation: the Assertion is about India's objection, which the government stated in Parliament.

No directly related past PYQ was found.