ISLAMABAD: Pakistan has offered Sri Lanka use of Gwadar Port for warehousing to facilitate trade with Afghanistan, Central Asian Republics and Middle East. This was stated by Prime Minister’s Advisor on Commerce and Investment, Abdul Razak Dawood in an exclusive chat with Business Recorder.
Dawood who accompanied Prime Minister Imran Khan during his official visit to Sri Lanka said that the purpose of the visit was to find out what Pakistan can achieve by expanding bilateral trade and investment.
One purpose was to review the status of Free Trade Agreement (FTA) effective from June 2, 2005 and make progress on it. He said, Pakistan's exports to Sri Lanka have doubled. Total trade is $ 400 million, with exports over $ 300 million whereas imports are less $ 100 million.
FTA with Sri Lanka is the only one which is in favour of Pakistan. Sri Lanka argues that FTA is unbalanced and has sought Pakistan's help. Sri Lanka's main export item is tea and Pakistan imports a very meager quantity from Sri Lanka with bulk of our tea imported from Kenya.
"I assured Sri Lankan that their viewpoint is correct and Pakistan will try to balance it," he added.
Both countries impose Regulatory Duty (RD) on items of their interest. Sri Lanka has imposed RD on Pakistani rice which has now been lifted. They also imposed higher duty on Pakistan cement, which they have promised to review now. Pakistan imposes RD on Sri Lankan products.
"During discussion on such issues, it was decided that the Joint Working Group (JWG) of both countries will hold meeting in April in which all these issues will be sorted out," he continued.
In reply to a question, he said, the issue of import of auto parts from Sri Lanka also came under discussion but it was not important for them. However, this issue will also be discussed during the JWG meeting.
"I also proposed that FTA should be widened and now services sector and investment be included in it," he maintained.
According to Abdul Razak Dawood, he informed Sri Lankan that Pakistan 's deliberations with Afghanistan and Uzbekistan are at an advanced stage. Sri Lanka showed keen interest and sought clarification after clarification.
"I proposed Sri Lankan to use Gwadar Port's gateway for export to Afghanistan and then Uzbekistan and from there to entire Central Asia. They showed keen interest in the proposal. I also told them that since Pakistan is allocating land to Uzbekistan for warehousing and export, the same facility can also be provided to Sri Lanka. In April's JWG meeting, this issue will also be discussed," Dawood said.
Sri Lanka sought different clarifications about duties in the case of goods warehoused at the port. Dawood assured them that there will be no duty at all and these goods can be transported through CPEC route.
Sri Lankans are not investing in Pakistan even though there are a number of Memon community businessmen who have interest in Pakistan, who showed a keen interest in investment in garment industry of Pakistan. This was also confirmed by a Pakistani businessmen from Faisalabad who stated that Afghanistan, Uzbekistan and now Sri Lanka are very good opportunities for Pakistan.
In reply to a question, Dawood said the actual and real term growth in exports are two different things. The figures of Finance Ministry and SBP show negative growth of about 4.4 per cent in exports.
"There is always a difference in export figures of State Bank of Pakistan (SBP) and the Commerce Ministry. The figures of Commerce Ministry are based on the value of goods in dollars, shipped out from the country, whereas SBP's figures are based on the cash remitted against the exported goods," he explained.
Answering another question, he said that the officials of Uzbekistan will visit Pakistan next month to inspect sites at Karachi Port, Port Bin Qasim and Gwadar to select land for establishment of warehousing facilities. Their requirement will be 10 acres or 25 acres. In reply to another question, Abdul Razak Dawood said that next round of talks with Afghanistan on APTTA will commence next month.
Copyright Business Recorder, 2021