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January 1, 2015

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Pakistan, Afghanistan to start talks on PTA today

ISLAMABAD: Pakistan and Afghanistan will kickstart negotiations to sign Preferential Trade Agreement (PTA) in Islamabad from Thursday, January 1, 2015, in order to jack up the bilateral trade up to $5 billion over the next three years, official sources said.
“Pakistan will submit draft PTA to the Afghan side during the two-day deliberations in which Islamabad will make efforts to maximise its exports in cement, agriculture products by seeking reduction in duty and taxes to Afghanistan,” the official sources said on Wednesday.
Pakistan’s exports of cement to Afghanistan are witnessing declining trend in the recent months as Kabul is importing the commodity from Iran.
There are two factors involved in the decline in cement exports to Afghanistan, as construction-related work is decreasing and Iranian brand of cement is penetrating in the Afghan market, the sources said.
“In order to get our due share, Pakistan will seek waiver in duty and tariff structure on exports of cement, as currently there is 10 percent duty on our exports, an official said.
The Afghan authorities will also demand starting negotiations on the revision of Afghanistan-Pakistan Transit Trade Agreement (APTTA) within 2015, as this agreement would exhaust after five years.
In 2003, India and Afghanistan had signed PTA that resulted in boosting trade ties between the two countries.
Now, Pakistan will also make efforts to sign PTA with Afghanistan where Kabul would seek scaling down of the duty structure on fresh and dry fruits.
Pakistan had already granted such incentive to China and other neighbouring countries so there was no harm in granting the same facility to Afghanistan, the official added.
When contacted, Federal Commerce Secretary Muhammad Shehzad Arbab said the Pakistani side would submit its draft PTA to the Afghan side and would seek their comments in order to boost trade ties between the two countries.
He said Pakistan, Afghanistan and Tajikistan

would hold deliberations on signing trilateral transit agreement on January 3 in Islamabad with clear cut timeframe to move towards signing this agreement. However, the sources said the APTTA will cease to exist after the lapse of five years in the coming few months. The existing APTTA agreement states it will remain in force for five years from the date it comes into force. The APTTA illustrates this agreement will automatically renewed for a further period of five years thereafter subject to such modification as may be agreed upon unless terminated by either contracting party.
Pakistan desires to include Tajikistan in APTTA after the lapse of this existing agreement with effect from October 28, 2015.
In the aftermath of the signing of APTTA between Afghanistan and Pakistan in the last five years, the commercial trade (transit and bilateral trade) and noncommercial (NATO-related trade) showed fluctuating trends, as in the fiscal year 2009/10 the total trade was recorded at $3.332 billion with the share of commercial trade ($2.157 billion) and noncommercial trade ($1.165 billion). In the fiscal year 2010/11, the commercial trade was recorded at $1.871 billion and noncommercial trade at $11.65 million. The commercial trade was recorded at $1.256 billion in 2011/12 and noncommercial trade at $525 million, $1.319 billion commercial trade and noncommercial of $564 million in 2012/13 and $2.202 billion commercial trade and $688 million noncommercial trade in 2013/14.

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