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This research investigates the Impact of PAK-INDIA trade on Economy of Pakistan. Data were collected from GTAP-7 database and six sectors were included in the database, Textile, Pharmaceutical, Automobile parts and engineering, Agriculture, Financial and Insurance services and logistics.Â  Data were analyzed by using GEM-software.Â  Different simulation run on GTAP-7 database and various tariff rates applied.Â  It was revealed that if India were removing the sensitive list item, in this scenario both countries would have positive impact on GDP, Export, Import and Employment of Pakistan.Â  The results indicates that there in Agriculture, textile, Auto Pakistanâ€™s is head on India in MFN status.Â  In Pharmaceutical, Financial services and Logistics India has positive gain.Â  It was further revealed that if Pakistan is given MFN status to India, Pakistanâ€™s import decreased and Export increased and overall positive impact on Economy. This research analyzes the potential economic costsand benefitsof Pak-India trade in Textile, Pharmaceutical, Automobile parts and engineering, Agriculture, Financial and Insurance services and logistics. Thefirstscenariois whennormaltradingrelationwithIndiawillberestored;it meansthat bothcountries will give theMFN (Most FavoredNations)statustoeach other. Inthesecondscenario,the SAFTAwill beoperativeandthere will be freetrade between IndiaandPakistanandbothcountrieswill remove all tariffsandcustom dutiesfrom eachothersâ€™imports.TheGlobal tradeanalysisGTAPmodelisusedtoanalyzethe possibleimpactofSAFTAonPakistaninamulticountry,multisectorappliedGeneral equilibrium framework.After employingthe simplifiedstaticanalysisframework,theanalysisbasedonsimulationsrevealsthatcurrentdemandfor PakistaniTextile, Pharmaceutical, Automobile parts and engineering, Agriculture, Financial and Insurance services and logistics willexpandaftertheFTAand consumersurplus willincrease.Thedropinthedomesticpricesofdates willincreasethe production ofmany downstream industries,whichwillhave pleasantmultipliereffectsontheeconomyofPakistan.Thegovernmentmay reduceMFNtariffsonindustrialdatesbeforeimplementingtheFTA.Â 

international journal of management and information technology

IMPLICATION OF PAK-INDIA TRADE RELATIONSHIP ON PHARMACETICAL AND AUTOMOBILE AND ECONOMY OF PAKISTAN BY USING COMPUTABLE GENERAL EQUILIBIUM MODEL (CGE) Model