Pakistan establishing border markets to increase trade with Iran

ISLAMABAD: Pakistan is setting up three markets in areas bordering Iran to improve bilateral trade and create economic opportunities for people, commerce adviser said on Tuesday.

Adviser to Prime Minister for Commerce and Investment Razak Dawood said three border markets are being established at Gabd, Mund and Chedgi in Balochistan near the border with Iran.

The memorandum of understanding to establish border markets along the border was signed between Pakistan and Iran in April, Dawood said on Twitter.

The agreement was signed during Foreign Minister Mehmood Qureshi's tour to Iran.

Under the agreement, Pakistan and Iran will establish border markets.

In the first phase, three bazaars will be opened in the border points of Kuhak-Chadgi, Rimdan-Gabd and Pishin-Mand areas. In the second phase, border markets will be set up at three other border points.

“These will not only enhance bilateral trade but it would also provide economic opportunities and sustenance to people residing in the border areas,” said Dawood.

Currently, there is an insignificant bilateral trade with Pakistan and Iran despite immense potential.

Currently, the bilateral trade stands at $359 million including exports to Iran amounting to $36 million against its imports at $323 million.

Tariff and non-tariff barriers are major obstacles in the way of trade enhancement. All the four traditional transportation modes are available for bilateral trade, but unfortunately none of these modes of transportation are efficiently and economically utilised at present.

Iran is ready to export petrochemical, steel and liquefied petroleum products to Pakistan in return of rice, meat and other agriculture products in a barter trade arrangement.

Iran is willing to start barter trade with Pakistan with energy and agriculture sectors having potential to increase exports and imports, its official told Pakistani businessmen in a meeting. Iranian government is ready to facilitate Pakistan’s private sector to promote bilateral trade and investment, he said.

The government is resuming cargo train operation with Iran and Turkey. The train will cover a distance of 6,566 kilometres in three countries.

The first such train service was launched in August 2009. The operation was shut down after eight rides due to security reasons.

Pakistan government had expressed its willingness to enhance economic cooperation with Iran that is under US sanctions. The government said it is committed to strengthening bilateral relations with Iran and promoting bilateral cooperation in various fields.