Iran and Pakistan will hold talks on enhancing trade through free trade agreement (FTA) and energy cooperation as a high-level Iranian delegation led by the Iranian trade minister will pay a two-day official visit starting from August 25.
An official source said Iran was looking to strengthen its trade relations with Pakistan after the lifting of the United Nations (UN) sanctions. “If Iranians reduce their tariffs, the bilateral trade is expect to cross $ 1 billion mark within the next year.”
The Iranians, he said, had conveyed that they wanted to discuss FTA with Pakistani authorities. Both countries already had a preferential trade agreement (PTA) but the trade remained dormant due to UN sanctions, he added. Opening of bank branches will also be discussed.
Iran also wants to have government-to-government level talks on electricity imports. Pakistan presently imports 300 MW from Iran and they have offered to enhance it to 3000 MW to meet the requirements of Baluchistan. Iranian ambassador has held meetings with the officials of ministry of water and power during the last two weeks.
Pakistan is also looking for natural gas and crude oil imports from Iran. The deal on gas pipeline is already signed and Iran is ready to provide necessary financing for its initiation. The private sector refinery BYCO, sources said, was willing to import crude from Iran. The refinery is located in Hub coastal area of Baluchistan.
Both the countries signed PTA in 2006 but the bilateral trade remained negligible mainly because of the stringent Iranian quality standards and higher tariff. Both the countries had decided in April this year to enhance their bilateral trade to $ 5 billion per annum in next five years.
The sources said that Iran was serious in enhancing bilateral trade with Pakistan as a few weeks back Iranian authorities had approved nine Pakistani hot water treatment plants for fruits imports while six Pakistani companies were granted permission to export rice to the country.
Previously, the Iranians were reluctant to certify Pakistani firms even though Pakistan used best diplomatic efforts but this time their regulatory agencies had themselves taken the initiative to certify Pakistani firms, the source said, adding it would enhance export of wheat, rice, fruits and textile products to Iran.
