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FTA likely in 6 months: Pakistan, Iran agree to remove ‘anti-trade’ barriers

  • Both countries discuss issues related to trade, energy and payment mechanism at the 21st Session of Pak-Iran Joint Economic Commission (JEC)
Published August 19, 2022
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ISLAMABAD: Pakistan and Iran have agreed to remove “anti-trade” tariff and non-tariff barriers to enhance bilateral trade volume besides desiring to ink Free Trade Agreement (FTA) in the next six months.

This understanding was reached during the 21st Session of Pak-Iran Joint Economic Commission (JEC) hosted by Pakistan from August 16-18, 2022.

Informed sources told Business Recorder that the issues related to trade, energy and payment mechanism also came under discussion. Pakistan shared current international political situation which does not allow the start of formal banking channels with Iran. Iranian side was led by Iran’s Minister for Roads and Urban Development Rostam Ghasemi along with a delegation of 57 dignitaries from Iran. Secretary, Economic Affairs Division, Mohammad Humair Karim and other senior officers of Ministry of Economic Affairs Division were also present.

During the meetings, Federal Minister for Commerce Syed Naveed Qamar said Pakistan and Iran enjoyed multi-dimensional relations. Pakistan highly values its friendly and brotherly relationship with neighbouring country Iran, which is time tested. The two countries have complete trust, mutual understanding and convergence of views on all bilateral, regional and international issues.

Qamar noted that although current trade volume between the two countries was not commensurate with the true potential of the two countries, yet Pakistan was committed to take all possible measures to increase bilateral trade volume to the level of $5 billion. In order to increase bilateral trade both sides expressed their desire to finalise and sign the FTA within the next six months.

Pakistan, Iran to hold JEC meeting tomorrow

It was also discussed that the two sides decide to work together to opertionalise the Barter Trade as per the agreement signed between Quetta and Zahidan Chambers. Both sides further agreed to discuss removal of Tariff and Non-Tariff Barriers to enhance bilateral trade. On the sidelines of the JEC, the apex Chambers of Commerce from the two sides decided to hold more frequent business to business integrations.

In order to facilitate trade an additional border crossing point at Gabd (near Gwadar)-Reemdan has recently been operationalised by Pakistan. In addition, the purpose of agreement on International Transport between Pakistan and Iran aims at facilitating trade traffic from Turkey to Pakistan through Iran, while Iranian goods and passengers can have access to China through Pakistan. Pakistan will have the benefit of access to other Central Asian Republics and Europe through Turkey with operationalisation of the decisions taken in the 21st session of JEC.

Syed Naveed Qamar further stated that the Quetta-Taftan Road was trafficable however for further improvement of road various projects were being undertaken. He stressed upon the need of making visa conditions easier to facilitate the Pakistani traders and visitors.

Copyright Business Recorder, 2022

Comments

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Yousuf Ibnul Hasan Aug 20, 2022 11:56am
Pakistan and Iran trading within their currency could be result in 28% less in cost and will save the payment in Foreign Exchange as well as price fluctuating on weekly basis. It not only a market of products that are import from third country but also employ border population and discourage the smuggling. A complete Morabaha Instrument is available that can work successful.
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Hussain Naqvi Aug 20, 2022 11:22pm
@Yousuf Ibnul Hasan, if GoP use same mechanism with all our neighboring countries inflation will come down and foreign USD reserves will increase.
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Hussain Naqvi Aug 20, 2022 11:27pm
@Yousuf Ibnul Hasan, sorry forget to mention an increase in "barter trading" at gov level can also help save foreign reserves. Thanks.
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