New Delhi, Jan. 14: A Pakistani business delegation, which was supposed to participate in the partnership summit in Agra later this month, has cancelled its visit amid escalating tension between New Delhi and Islamabad over ceasefire violations.

Officials said they had received confirmation that the 10-member delegation would not be coming to India to be part of the annual flagship event organised by the Confederation of Indian Industry (CII) in association with the commerce and industry ministry.

"We have been told by the representatives of the delegation that they would not be part of the event. Though they did not give specific reasons, they hinted that the ongoing tension between the two countries was the reason behind the cancellation," a spokesperson for the CII said.

However, the CII said, Pakistan commerce minister Makhdoom Muhammad Amin Fahim had confirmed that he would participate in the three-day summit starting January 27. He is also one of the speakers at the event, which has "global partnerships for enduring growth" as its theme.

According to Pakistan-based business dailies, the recent violence at the Line of Control (LoC) has diminished India's hopes of getting the most favoured nation (MFN) status from Islamabad anytime soon.

"Commerce minister Makhdoom Amin Fahim is expected to meet his Indian counterpart Anand Sharma on January 28 in Uttar Pradesh and put in plain words the justification for the delay in the grant of MFN status to India from January 1, 2013," one of the dailies said.

Overseas ministers along with business delegations from the US, Japan, Australia, Canada, Russia and Spain will take part in the event.

CII officials said as many as 83 overseas business delegations had already confirmed their participation. Discussions on India-Pakistan trade and the growing interest of private sector in the regional market were also on the agenda.

According to CII officials, Pakistan was supposed to bring along the second highest number of delegates after Slovenia (32). "Now we believe that only their minister of commerce would be participating," he said.

Trade relations with Islamabad have taken a hit over the past week after two Indian soldiers were killed and mutilated along the LoC, apparently in violation of the ceasefire that has been respected by both the sides since it was put in place in November 2003.

Soon after India reacted to the killings, Pakistan stopped cross-border trade by barring trucks containing perishable goods, mainly vegetables, from entering Pakistan-Occupied Kashmir.

For the last two years, the two countries have been working on improving trade ties. Since February 2011, both the nations have announced a slew of measures, including the exchange of trade delegations and a pact on liberalising visa norms.