Iran expresses interest in becoming part of CPEC

KARACHI: Iran on Saturday expressed interest in participating in China-Pakistan Economic Corridor (CPEC) framework as the $60 billion worth of Chinese-funded projects entered into next phase of industrial and agriculture cooperation.

Iran's Commercial Attache to Pakistan Morad Nemati Zargaran said CPEC is essential and opens up huge opportunities for Pakistan and Iran.

“Iran wants to become part of this project which would surely ensure prosperity in the entire region,” Zargaran said at a meeting with businessmen.

He was a leading an Iranian delegation’s visit to Karachi Chamber of Commerce and Industry (KCCI). CPEC framework started infrastructure projects – power generation and road networks – in Pakistan five years back, connecting its western province to Arabian seas as a part of Belt and Road initiative.

Iranian envoy said business communities of the two countries have to meet more frequently and improve their contacts, besides holding single country exhibitions which would certainly improve bilateral trade and investment.

Zargaran assured his full support and cooperation to the business community so that trade could improve further and they collectively explore new avenues of trade cooperation.

The attaché said steps have to be taken to deal with the barriers hindering smooth trade between the two countries. High customs duties need to be brought down to encourage legal trade and discourage smuggling, he said.

“Formal banking channel between the two countries has to be activated which is widely being demanded by the business communities of the two countries since quite some time now.”

Vice President KCCI Shahid Ismail said bilateral trade remains low and Pakistan and Iran must make collective efforts to explore new avenues.

“It has always been KCCI’s struggle to promote bilateral trade and the chamber has a very positive approach towards improving trade ties particularly with neighbouring countries,” Ismail said.

KCCI official said the bilateral trade is much less than the potential as Pakistan’s exports to Iran stood at a mere $330.2 million in 2018, while imports were around $1.247 billion.

Ismail said negotiations on free trade agreement (FTA) between Iran and Pakistan are underway. Both the countries have shared their desire of upgrading preferential trade agreement into FTA for which initial drafts have already been shared.

The State Bank of Pakistan has also shared draft of memorandum of understanding (MoU) for signing banking paying arrangement with Iranian Bank Markazi Jomhouri.

Both countries have already signed MoU through which channels would be opened in the central banks of both the countries for trade transactions that would reduce the usage of dollar account for letter of credit clearance. Ismail hoped that desperately-needed proper banking channel between Pakistan and Iran becomes a reality soon, “which would surely boost the existing trade ties”.

KCCI vice president underscored need to sort out infrastructural constraints to enhance bilateral trade via Quetta-Taftan land route.

“Regular operation of ECO (Economic Cooperation Organisation) container train will lend impetus to cargo and transit facilities between the two countries.”