ISLAMABAD – Pakistan and Iran signed on Thursday a strategic framework agreement to further deepen their economic relations under the existing Preferential Framework Agreement (PTA) and to enhance bilateral trade from a current $1.2 billion to $5.0 billion within the next five years.
Minister for Commerce Makhdoom Amin Fahim and Iranian Commerce Minister Mehdi Ghazanfari signed the agreement at the conclusion of the sixth Pak-Iran Joint Trade Commission (JTC) meeting here on Thursday.
A Memorandum of Understanding (MoU) was signed between the Trade Development Authority of Pakistan and Islamic Trade Promotion Organization of Iran to cooperate in boosting bilateral trade. Talking to media after the signing ceremony, the Iranian Commerce Minister said that Iran is ready to remove the tariff and non-tariff trade barriers with Pakistan, while the next five years would see significant improvements. However, he said, most of these issues were due to the absence of banking, insurance and communication links between both countries.
Pakistani exporters, he said, should explore Iranian markets to forge trade links with Turkey, Iraq and Central Asian Republics. “Iran has constructed a beneficial railway line with Turkey, while communication links are available with CARs and Iraq. It is at Pakistan’s discretion to utilise these links directly or indirectly”.
On the Free Trade Agreement, he said, Iran is ready to negotiate but only after enhancing the existing PTA that provides preferential treatment for 600 tradable items. “Greater help from the private sector and their active role can lead to further improvement.”
Under the five-year strategic plan, both sides agreed to constitute a Joint Working Group, comprising of public and private sector representatives. Its first meeting would be held in Tehran within four months. This group is aimed at increasing bilateral trade, improving linkages through roads and railways, removing non-tariff barriers, enhancing private sector cooperation and conducting single country exhibitions.
Pakistan and Iran sign agreement to boost trade
