Iranian trade team underscores need for finalising FTA

Source: Business Recorder

KARACHI: Leader of a trade delegation from Tehran Chamber of Commerce, Industries, Mines and Agriculture (TCCIMA) Morad Nemati has said that although a Preferential Trade Agreement (PTA) exists between Iran and Pakistan but in order to further improve the existing trade volume, Iran and Pakistan must finalize the Free Trade Agreement (FTA) at the earliest possible time as this important agreement has been pending since long.

“You, the business community of Karachi Chamber, should push your government to expedite Iran-Pakistan FTA and give it a final shape so that the trade between the two brotherly countries could substantially be improved as per potential,” he said while speaking at a meeting during the visit of Iranian delegation to Karachi Chamber of Commerce and Industry (KCCI) on Tuesday.

Senior Vice President KCCI Touseef Ahmed, Vice President KCCI Haris Agar, Former Vice President Qazi Zahid Hussain and KCCI Managing Committee Members attended the meeting while the Iranian delegation comprised of Secretary General Iran Food Federation Rashid Azizpour, Chairman Iran Dairy Association Mir Eslam Teimoury, Chairman Tehran Tile Association Samie, Vice Chairman Tehran Tile Association Nazifi and Member of Iran Construction Association Shahryar Shahryari.

Morad Nemati further stressed the need for making collective efforts to remove trade barriers focus should be on reducing the gap between the business communities which was a major issue hindering trade and investment cooperation. “In addition to removing trade barriers, the two sides must also promote barter trade further with a view to boost the existing trade ties.”

“Enhanced trade and investment ties with the business community of Karachi are very important to us; hence, we are concentrating on improving our connections with the business community of this city where an Iranian Single Country Exhibition is currently under way at the Expo Center,” he said while inviting the Karachi Chamber to also send a trade delegation to Iran to explore avenues of trade and investment cooperation. He said that as Iranian Dairy Industry, Construction Sector and other important sectors of the economy have witnessed significant growth, the business communities of the two countries can take advantage of the situation by looking into the possibility of undertaking joint ventures in these sectors.

Earlier, Senior Vice President KCCI Touseef Ahmed, while welcoming the Iranian delegation, stated that despite excellent brotherly relationships, the bilateral trade volume was below the potential of US$5 billion.

He said that it was high time to upgrade the existing Pakistan Iran Preferential Trade Agreement (PTA) to FTA which would revive Pak-Iran bilateral trade to the next level and develop deep financial & economic cooperation. “The existing barter trade basket also needs to be expanded to other products to facilitate imports & exports between the two countries and further deepen Pak-Iran economic integration”, he added.

He was of the view that the consensus reached by Pakistan-Iran, Joint Trade Committee to ensure phase-wise implementation of border markets and investors’ access to the special economic zones would not only strengthen cross-border economic cooperation but also discourage illegal border trade and subsequently improve formal trade between the two countries.

He said that unavailability of a payment mechanism was a major hurdle,; therefore, both countries need to explore other workable payment mechanisms like local currencies. “To broaden the economic ties, the Pak-Iran gas pipeline project also needs to be prioritized.”

Speaking on the occasion, Vice President KCCI Haris Agar also stressed the need for having banking channel between the two brotherly countries which would substantially raise the existing trade volume as the business communities were unable to directly send and receive payments due to lack of banking channel which badly discourages trade. “Sky is going to be the limit if banking channel is introduced therefore, the two countries should seriously pay attention to it”, he added.