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February 10, 2018

Pakistan, China agree to revise FTA in trade parleys


February 10, 2018

Islamabad: In a major breakthrough on trade parleys held at Beijing, Pakistan and China on Thursday agreed to revise whole Free Trade Agreement (FTA) under which Beijing will provide tariff concessions for increasing exports of Pakistan, it is learnt.

It is yet to see how much Chinese has incentivised Pakistan’s struggling exports on annual basis. Pakistan’s Federal Commerce secretary has forcefully presented Islamabad’s case, and it seemed that he had managed to secure fairly good deal with Chinese side.

When contacted, Pakistan’s Federal Secretary Commerce Younas Dagha, who is leading the country’s delegation in two days talks held on finalised the revised FTA with China, confirmed to The News on Thursday night that both the countries agreed to revise overall FTA and now the agreed position would be presented to the Federal Cabinet for seeking final approval, and it was expected that both the countries would sign approved protocol next month.

Earlier, the official sources who participated in trade talks told this scribe that China has agreed to accommodate Pakistan’s concerns on FTA. During the 9th round of parleys held on China- Pakistan FTA for two days at Beijing, the Pakistan delegation led by Commerce Secretary Mohammad Younas Dagha and Chinese side was led by Wang Shouwen, Vice Minister, Ministry of Commerce People’s Republic of China.

Younas Dagha presented the demands of Pakistani exporters and industries for accommodating in the final draft of the CPFTA. The demands included those from exporters to provide tariff concessions equivalent to the Asean countries. On the other hand, various industries and chambers had provided input to the Ministry of Commerce during pre-negotiations consultations, for protection of the local industry from Chinese imports by disallowing tariff concessions on several products.

Mr Dagha also suggested incorporating clauses for safeguarding the industries and the economy from any undue pressure on the balance of payments position. After intense negotiations for two days, the Chinese side agreed to accommodate these concerns and demands in the amended FTA which is expected to be signed in March when the Chinese vice minister will visit Islamabad along with a high powered delegation.

It may be mentioned that these negotiations had started in 2012 to finalise the revised version of CPFTA. Under the first phase of FTA, Pakistan’s trade balance with China had worsened, and it had registered $12 billion mark in last financial year 2016-17. Keeping in view such massive trade deficit, Pakistan requires immediate relief on boosting its exports; otherwise, there would be no other option but to seek another bailout package from the IMF in order to avert balance of payment crisis.

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