Islamabad: Pakistan's decision to give India Most Favoured Nation (MFN) status is being misconstrued though it is only aimed at ensuring that there is no discrimination in bilateral trade, Prime Minister Yousuf Raza said on Sunday.

"People have not understood the abbreviation MFN. You think this Most Favoured Nation becomes 'most favourite friend'. The real meaning is that there will be no discrimination," Gilani said while interacting with journalists during a private visit to Pir Jo Goth in southern Sindh province.

"When Pakistan was formed and Muhammad Ali Jinnah was the Governor General, this same status was given to India. We have such relations with 100 countries. This means India would be one of them," he added.

Gilani said the federal cabinet had allowed the Commerce Ministry to negotiate with its Indian counterpart on the issue of trade balance.

The government will never compromise on the country's national interests while taking steps like giving India MFN status, he said.

He noted that since his government came to power in 2008, trade across the Line of Control had been recorded at Rs 15 billion. The annual trade between China and India, despite their border dispute, was to the tune of USD 60 billion, he pointed out.

Several extremist groups, including the Jamaat-ud-Dawah, have opposed the government’s decision to give MFN status to India by the end of the year. They have threatened to launch protests if the government goes ahead with the move.

Following talks between Indian Commerce Minister Anand Sharma and his Pakistani counterpart Makhdoom Amin Fahim in Islamabad last week, the two sides agreed to switch over to a negative list regime for trade by the end of February.