Global Rice News

Ambassador of Iran Predicts Bilateral Trade Agreement with Pakistan

ISLAMABAD, MAR 15 (DNA) — The Ambassador of Iran to Pakistan, Dr. Reza Amiri Moghadam, expressed optimism that the bilateral Free Trade Agreement (FTA) between Iran and Pakistan will be finalized during the upcoming visit of Iranian President, Ebrahim Raisi. This agreement is expected to significantly boost trade between the two countries.

During a visit to the Islamabad Chamber of Commerce and Industry, Dr. Reza Amiri Moghadam stated that the visit of the Iranian president to Pakistan will pave the way for various economic and trade agreements. These agreements will further strengthen the economic ties between Iran and Pakistan, promoting bilateral business opportunities.

The current bilateral trade volume between the two countries stands at $2.5 billion, marking an 11% increase over the past 11 months. With the implementation of the FTA and other bilateral agreements, there is a strong possibility that trade between Iran and Pakistan will double in the next few years, reaching $5 billion.

One significant aspect of the economic partnership between the two countries is the Pakistan-Iran gas pipeline. This project, costing Iran $1 billion, will provide substantial benefits to Pakistan’s domestic and industrial sectors by resolving its energy problems.

Dr. Reza Amiri Moghadam highlighted that Iran already engages in energy and gas trade with Turkey, Turkmenistan, Iran, and Azerbaijan. Pakistan can adopt similar procedures to further enhance its trade with Iran. However, the issue of a banking channel between the two countries needs to be addressed. Iran currently has banking channels with Turkey, Bahrain, and Iraq, which can serve as a model for Pakistan.

Improvements in air, maritime, and sea links are crucial to strengthen economic relations between the two nations. By connecting through ports such as Karachi and Gwadar in Pakistan and Chabahar and Bandar Abbas in Iran, both countries can expand their regional and global trade networks. The Iranian ambassador proposed declaring Gwadar and Chabahar as sister ports to enhance cooperation.

Pakistan and Iran can capitalize on the opportunities provided by the China-Pakistan Economic Corridor and the Belt and Road Initiative. By connecting to the North-South and East-West trade corridors, both nations can achieve economic and trade integration and access European markets.

Dr. Reza Amiri Moghadam emphasized the potential for mutually beneficial trade between the two countries, with both nations capable of fulfilling 70% of each other’s needs. For instance, Iran imports halal meat, which presents an opportunity for Pakistan to increase its exports in this sector.

The Ambassador also highlighted the importance of strengthening ties between the business communities of Pakistan and Iran. He suggested closer cooperation between the Islamabad Chamber of Commerce and Industry and the Tehran Chamber of Commerce and Industry.

President of the Islamabad Chamber of Commerce and Industry, Ahsan Zafar Bakhatwri, stated that the annual trade volume between Pakistan and Iran exceeds $2.5 billion. Pakistan primarily exports rice and other products to Iran, while residents of the border area of Balochistan benefit from buying Iranian food and goods from traders across the border.

Under the five-year trade cooperation plan for 2023-2028, Pakistan and Iran aim to increase their annual trade volume to $5 billion. Both countries are members of various regional and international organizations, including the Economic Cooperation Organization (ECO) and the Organization of Islamic Cooperation (OIC).

The membership of Iran in the Shanghai Cooperation Organization (SCO) is expected to further enhance interactions and collaboration between the two nations. The development of stronger people-to-people exchanges and cooperation in science and technology will also play a vital role.

Efforts to facilitate increased barter trade between Pakistan and Iran require infrastructure improvements, while challenges such as high tariffs from the Iranian side and the absence of credible payment mechanisms need to be addressed.

Source: DNA