Cabinet gives nod to trade deal with Turkey

ISLAMABAD: The federal cabinet on Thursday approved a trade deal recently agreed with Turkey, paving the way for its formalization in the coming months.

The Trade in Goods Agreement was unveiled during Prime Minister Shehbaz Sharif’s trip to Ankara in June.

Under the deal, Tukey will provide concessions to Pakistan on 261 tariff lines, including immediate zero rating on 123 items. Islamabad, in turn, will extend concessions on 130 tariff lines to Turkey.

These items include products from eight major sectors, including agriculture, chemicals, leather, plastic, rubber, engineering and metal industries.

“The federal cabinet on the recommendation of the Ministry for Trade approved the signing of the Trade-in-Goods agreement between Pakistan and Turkey,” a statement said.

The deal will support the countries’ efforts to facilitate “better access to each other’s services and investment sectors,” and help them achieve the objective of pushing bilateral trade up to $5 billion, it added.

During his trip to Ankara, Sharif termed Pakistan’s trade with Turkey “insufficient,” while Turkish President Recep Tayyip Erdogan confirmed that the two sides have set a target of raising bilateral trade to $5 billion in the next three years from the present $1.1 billion.

The two sides are also working closely on convening the 7th High Level Strategic Cooperation Council (HLSCC) – led by the two prime ministers – in September this year in Islamabad to sign about seven agreements and finalise other pacts and memorandums of understanding.

Before that, the two sides have to review the implementation status of the existing agreements as well as the strategic economic framework (SEF) and identifying new areas of cooperation in the SEF. Some of the upcoming agreements pertain to highway engineering between the Turkish ministry of transport and infrastructure and Pakistan’s ministry of communication, technical cooperation between the central banks, treasury and finance authorities in debt management and knowledge sharing, cooperation in urbanisation, climate change and environment and housing sector investment.

Pakistani authorities are seeking Turkish expertise on how to improve Pakistan’s entire business ecosystem by utilising Turkish experience with the European Union.

Meanwhile the cabinet meeting on recommendations of the Ministry of Trade, also okayed Multi Model Air-Road Corridor for Afghan Transit Trade.

Pakistan opened its air trade route for to commercial cargo destined to landlocked Afghanistan in October last year to help its war-torn neighbor’s Taliban government deal with a deepening economic crisis.

A bilateral transit treaty, enacted in 1965 and renegotiated in 2010 with the United States mediating, grants Kabul the right to conduct duty-free international trade through Pakistani airports, seaports and overland routes.

In turn, Islamabad is allowed to use the designated Afghan transit corridor to trade with Central Asian countries.