The prime minister’s aide was giving a briefing on Tuesday to the Senate Standing Committee on Commerce about Pakistan’s trade diplomacy for promotion of trade and investment in the country. The highest exports of Pakistan are to the US followed by China. The country’s highest imports are from China.
The adviser told the Senate panel that the existing Free Trade Agreement (FTA) with China was inclined in favour of the Chinese. Both the countries are considering signing another agreement to balance the trade flow in favour of Islamabad.
A number of FTAs and preferential trade agreements are also under discussion with other countries and Pakistan’s interest will be protected while finalising them, he added.
Aziz said Pakistan’s exports had dwindled in the past five years because of certain domestic and international factors. “The government is focusing on effective trade diplomacy to boost exports,” he said.
About avenues of trade with Iran, the adviser said that US sanctions on Iran were still in place and businessmen were experiencing difficulties in opening Letters of Credit (LC) in dollars. He added, however, traders could open LCs in Euro to undertake business with Iran.
He informed the Senate committee that Iran and Pakistan recently signed a five-year strategic trade plan, under which the annual bilateral trade would be taken to $5 billion in the next five years.
“We have proposed and plan to take certain effective steps to achieve the trade target,” said Aziz. The pact was signed during the recent visit of Iran’s president to Pakistan.
Pakistan has also announced its Strategic Trade Policy Framework 2015-17 to boost its exports to $35 billion while focusing on effective trade diplomacy through its consulates to explore new markets in the world.
PPP Senator Saleem Mandviwalla, who is a member of the committee on commerce, observed Pakistan, unlike other countries in the region, had failed to tap the potential of trade and investment with Iran in the backdrop of the lifting of the sanctions.
He mentioned the PPP government had signed the Iran-Pakistan pipeline project despite the sanctions and opposition by the international community.
Mandiwalla questioned when the government planned to construct the pipeline on the Pakistani side when Iran has already completed the project on its side.
Senator Usman Kakar said border trade with Iran and Afghanistan from Balochistan must be taken away from the control of interior ministry and frontier corps and handed over to the commerce ministry.
Mandviwalla pointed out that Pakistan’s exports declined by $2.2 billion during 2015-16 as compared to the previous year, saying the government has failed to turn around exports while countries like Bangladesh and Vietnam were performing far better.
He also said the government had failed to reap the benefits of GSP+ status granted by the European Union (EU) for which PPP government had made untiring efforts.