Commerce Minister Engin-eer Khurram Dastagir Khan said on Thursday that Pakistan is to revive the quadrilateral agreement with China, Kyrgyzstan and Kazakhstan to reach Central Asia without depending on Afghanistan as there is a standstill in transit trade and bilateral trade with Kabul. Quadrilateral agreement for traffic in transit, which covers only movement of goods, was signed on March 9, 1995 and came into force in May 2004.
"As there is no progress on trade relations with Afghanistan, we are reviving Quadrilateral agreement as an alternate so that Pakistan can have access to those Central Asian States including Tajikistan through China under the China-Pakistan Economic Corridor (CPEC). Kashgar will be connected to Tajikistan as well as Pakistan which will resolve the connectivity issue, said Khan while giving a detailed briefing to the National Assembly's Standing Committee on Commerce, headed by Siraj Muhammad Khan. With the completion of Gwadar-Chaman road, a new door of trade with Central Asia will open.
The Commerce Minister stated that Pakistan had sent the drafts of Preferential Trade Agreement (PTA) and transit trade agreement with Central Asian States but Afghanistan did not positively respond and President Ashraf Ghani sent the drafts to National Security Advisor. He said Afghanistan wants inclusion of India in the agreement which is not possible at this stage. Bilateral trade between Pakistan and Afghanistan is around $2 billion.
"India is insisting that it should also be included in the agreement with Afghanistan and Tajikistan. Pakistan and India have started talks but there is a diplomatic strain between the two countries," he added. The Commerce Minister was of the view that Pakistan is very positive on Afghanistan and wants to facilitate Kabul in trade but also awaits for reciprocity from them. Pakistan wanted economic integration with Afghanistan but this has not happened as things have not normalised so far.
"After a goodwill period of winter and summer of 2015 things have just now reached a standstill," he continued. He said Afghanistan's trade with India is open through Karachi and through train from Lahore but they are demanding road access for its trucks, adding Pakistan cannot allow Afghan trucks' entry to India through Wagha until certain issues between Pakistan and India are resolved.
The Commerce Minister informed the committee that an Afghan delegation is visiting Pakistan next week, adding that Pakistan will make all-out efforts to resolve issues. Commenting on documentation of Afghanistan transit trade, the Commerce Minister stated that officials face resistance at Torkham and Chaman points, adding that intensity of resistance at Chaman is very high .
"There are severe issues of informal trade with Afghanistan," Khan maintained. Briefing on trade ties with Iran, Commerce Minister said that relations with Iran are improving. Both countries have a PTA but it is not being implemented. Pakistan has offered Iran to sign a Free Trade Agreement (FTA) instead of haggling on PTA. Iran has lifted restrictions on Pakistani rice and mangoes.
In reply to a question, Dastgir said that the United Nations, the US and the European Union (EU) have lifted restrictions on Iran but restrictions on banking channels are still intact, hoping that banking restrictions will be done away by June next. Answering another question, the Commerce Minister stated that Pakistan is not allowed to hold an exhibition of finished goods in Iran but this concession is available to India.
Pakistan is dispatching a delegation headed by Minister for National Food Security and Research Sikandar Hayat Bosan who will visit Iran to resolve the issues with respect to export of food items and an exhibition of Pakistani products. A team of State Bank of Pakistan (SBP) will also be visiting Iran to finalise payment mechanism.
The Commerce Minister informed the committee that Pakistan's banks are under very tight surveillance with respect to trade with Iran. Secretary Commerce Shahzad Arbab apprised the committee that two more crossing points are being opened with Iran, bringing the number to three. These are aimed at facilitating trade. Alhaj Shah Jee Gul Afridi urged on the government to focus on neighbours Afghanistan and Iran to promote bilateral trade. He was of the view if Afghanistan depends on Pakistan for trade, militancy and terrorism will ultimately diminish.
Briefing on Strategic Trade Policy Framework 2015-18 (STPF 2015-18), the Commerce Minister stated that measures in the SPTF 2012-15 announced by the PPP government were good but its funding was only 30 per cent due to which it was not fully implemented. He said the Commerce Ministry has started working on STPF 2015-18 one and half years earlier and suggestions were sought from all the stakeholders. According to him, STPF 2015-18 is awaiting Prime Minister's approval; after an approval is accorded implementation will commence on trade policy. However, he acknowledged that the issues like rupee overvaluation, refunds, prices of electricity and gas, new connections of gas and transportation are not in the domain of Commerce Ministry.
Dastgir further stated that he has recommended to the Prime Minister Nawaz Sharif to pay refunds to exports at once and later reduce duty to zero to avoid refunds saga. Commerce Minister said the government has already earmarked Rs 6 billion for 2015-16 to implement trade policy measures. Nine sectors which will show growth in exports will be given four per cent refund through State Bank of Pakistan (SBP).
The Commerce Ministry has proposed the following targets;(i) from the current level of approximately $24 billion, increase in merchandise export up to $35 billion by 2018;(ii) improving export competitiveness ;(iii) shift from ' factor-driven economy" to " efficiency-driven and ' innovation-driven economy and ;(iv) increasing share in regional trade. Pervez Malik informed the committee that tariff for industrial sector has increased in January 2016 as compared to December 2015, after a reduction in tariff by Rs 3 per unit, requesting the Minister to analyse the tariff. Shahzadi Umarzadi Tiwana and Tahira Aurangzeb urged the Commerce Ministry to allocate 70 per cent quota of trade officers to Commerce and Trade Group.
Chaudhry Asad-ur-Rehman criticised the Minister for focusing on exhibitions of food items instead of giving attention to textile sector. The committee passed the "Template of Memorandum for Trade Organisation Bill". The PSDP of Commerce Ministry for 2016-17 was approved by the committee unanimously. The meeting was attended by Choudhry Muhammad Shahbaz Babar, Chaudhry Asad ur-Rehman, Pervez Malik, Mian Muhammad Rashid, Tahira Aurangzeb , Shahzadi Umarzadi Tiwana, Nazir Ahmad Boghio, Musarrat Ahmed Zeb, Sajida Begum, Sanjay Parwani, Alhaj Shah Jee Gul Afridi and Dr Fauzia Hameed.
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