Iran, Pakistan Keen on Promoting Trade Ties

EghtesadOnline: Pakistani Prime Minister Imran Khan on Friday stressed the need for Pakistan and Iran to take concrete measures against smuggling and ensure more business opportunities for the people residing along the border.

News ID: ۷۴۷۷۸۸

07 July 2019

In a meeting with Iran’s Minister of Industries, Mining and Trade Reza Rahmani in Islamabad, the Pakistani prime minister reaffirmed his country’s commitment to strengthen relations with Iran in diverse fields, including people-to-people exchanges, the Associated Press of Pakistan reported.

Khan said geographical proximity and close brotherly ties rooted in historical, cultural and religious commonalities offered huge potentials to enhance mutual trade and economic cooperation for the benefit of the two countries.

The Iranian minister conveyed the Iranian leadership’s greetings to Khan, whose visit to Iran had provided momentum to efforts aimed at cementing bilateral relations, especially trade and economic ties, Financial Tribune reported.

Rahmani expressed great satisfaction over the progress made by Iran-Pakistan Trade Committee in removing obstacles to mutual trade development.

Deputy Agriculture Minister Yazdan Saif, MP Ramezanali Sobhani, Chairman of Sistan-Baluchistan Chamber of Commerce Abdullah Rigi Mirjaveh and Ambassador Mehdi Honardoost accompanied the Iranian minister.

Pakistan's Minister for Maritime Affairs Ali Haider Zaidi, PM’s Adviser for Commerce Abdul Razzak Dawood, Chairman of the Board of Investment Zubair Gillani and Commerce Secretary Ahmed Nawaz Sukhera also attended the meeting.

Agreement to Promote Barter Trade

Pakistan and Iran on Friday agreed to create a committee to identify goods for promoting barter trade.

The decision was reached at the concluding session of the Eighth Iran-Pakistan Trade Committee. The Pakistani delegation was led by Adviser to the Prime Minister for Commerce Abdul Razzak Dawood while the Iranian side was led by Industries Minister Reza Rahmani, Dawn reported.

It was suggested that for barter trade to begin, the two countries should select commodities having competitive advantage. In this regard, Pakistan can enhance the export of wheat, sugar, rice and fruit to Iran.

The Iranian side acknowledged the fact that bilateral trade relations did not match the real potential, particularly in agriculture, food and pharmaceutical sectors.

Iran showed interest in importing 500,000 tons of rice from Pakistan and urged that a mechanism for early shipment must be devised.

The Iranian delegation extended its full support to work on the removal of potential bottlenecks to increase trade and jointly develop a way forward.

The Iranian side also requested the Pakistani government to open more border checkpoints, mainly at Ramadan, Pishin and Korak, which will further enhance bilateral trade.

Dawood suggested the removal of various taxation measures such as road and freight taxes on vehicles/trucks crossing the borders to facilitate trade.

He promised to establish an exclusive desk at the Trade Development Authority of Pakistan in Islamabad to address related issues.

The two sides agreed to resolve issues, including removing barriers that have made Iran-Pakistan Preferential Trade Agreement (signed in 2006) ineffective.

The Federation of Pakistan’s Chambers of Commerce and Industry also advocates the promotion of barter trade between Pakistan and Iran, as the preferential trade agreement between the two countries has not been fully utilized due to sanctions on Iran.

At present, Pakistan and Iran enjoy a PTA that gives concessions on 18% of items, but the PTA is not being utilized fully due to Iran sanctions.

“Pakistan is losing its market of mangoes, rice, citrus fruit and other agriculture items,” FPCCI President Daroo Khan Achakzai recently said.

He called for the promotion of barter trade between the two countries, as Pakistan has huge potential in exporting agriculture products and edible fruit and vegetables, while in return Iran has the potential to export crude oil and petroleum products.

Achakzai said annual trade between Pakistan and Iran stands at $398.5 million, wherein the volume of Pakistan’s export to Iran stands at $21 million and import from Iran is at $377.4 million.