$10bn trade aimed at Islamabad, Tehran discuss FTA prospects

ISLAMABAD: Pakistan and Iran have reportedly discussed pros and cons of long-awaited Free Trade Agreement (FTA) replacing the existing bilateral mechanism aimed at taking the trade to nearly $ 10 billion.

Pakistan’s Commerce Minister Jam Kamal Khan and Farzaneh Sadegh, Minister of Roads and Urban Development of Iran formally inaugurated the 22nd meeting of Joint Economic Commission between Pakistan and Iran today at Tehran.

According to sources, issues hindering barter trade including smuggling, problems faced by Pakistani businessmen, resolution of hurdles in payment mechanism, LPG import from Iran and other trade related matters came under discussion.

Pakistan, Iran set $10bn trade target

The issues related to delay in Iran-Pakistan Gas Pipeline also came under discussion to avoid international litigation.

Pakistan has to move forward on only those items which are allowed under the UN Convention but will not trade “others”, clarification of which has not been shared by the Ministry of Foreign Affairs to Commerce.

The language of barter trade agreement between Pakistan and Iran is a key hurdle in increase in trade of those items which are covered under the mechanism.

At a recent meeting of Senate Standing Committee on Commerce, Commerce Ministry’s team was grilled for failing to finalize the things required to increase bilateral trade.

According to official statement, during his inaugural remarks, Jam Kamal said Pakistan attaches high value to its relations with Iran. Trade and investment is the core of Pakistan’s trade policy. Private sector and chambers of commerce should play active role to enhance the trade volume.

“Our government is fully committed to support and facilitate the private sector to do business with Iran. The mutual cooperation in services sector, agriculture and animal husbandry, scientific research and food security can bring benefits to the region,” he added.

Regional connectivity through roads, rail, Maritime and air can prove a game changer and serve as a gateway to Central Asia, South Asia and Middle East.

The Minister added that the materialization of such projects will create job opportunities and economic activities.

The Iranian minister welcomed the participants and highlighted the importance of this forum. She said deliberations in these sessions will lead to roadmaps for the future and the follow-ups will definitely bring results.

She pointed out steps that need to be taken for ease of business, visa facilitations, border markets, and banking sector.

Both the leaders while co-chairing the meeting said in the present scenario both sides can benefit from experiences in water management, disaster management and environmental change.

Meanwhile, Jam Kamal Khan held a comprehensive bilateral meeting with Farzaneh Sadegh, on the sidelines of the Pakistan–Iran Joint Economic Commission. Both Ministers were accompanied by senior officials and led their respective delegations.

During the meeting, the two sides reviewed progress on key areas of cooperation including road and rail connectivity, facilitation of border markets, customs data sharing, and enhancement of maritime services. They underlined the importance of improving cross-border infrastructure to boost trade and people-to-people linkages.

Jam expressed appreciation to Sadegh for organizing and facilitating the 22nd session of the Joint Economic Commission, noting that Pakistan attaches high priority to expanding its economic partnership with Iran through better connectivity and coordinated institutional support.

Copyright Business Recorder, 2025