Iranian delegation due next week: Joint investment in fertilizer production under study

ISLAMABAD: A high level Iranian delegation led by Foreign Minister Hossein Amir-Abdollahian will visit next week to discuss bilateral issues including possibility of exploring investment projects under a trilateral arrangement between Pakistan, China and Iran, well informed sources told Business Recorder.

Iranian delegation is coming to Pakistan just days after the visit of Pakistan’s Army Chief General Syed Asim Munir to Iran. Both countries are also negotiating proposals for joint investment in fertilizer production.

The understanding was reached between Islamabad and Tehran last month during a visit of a four-member Iranian delegation from the Organisation of Investment, Economic and Technical Assistance of Iran (OIETAI) led by Ali Fekri, Deputy Minister/ Head of OIETAI.

Irani Foreign Minister will visit Pakistan on 03-04 August 2023. During the visit, he would meet the Prime Minister, Foreign Minister, Chairman Senate, Speaker of National Assembly. One day before the visit of the Iranian FM (August 2), an economic delegation would visit Islamabad, led by Iranian Deputy Minister for Economic Affairs, Mehdi Safari. The economic delegation would hold intensive-discussions with their Pakistani counterparts and discuss all issues pertaining to economy, trade & investment, energy cooptation, aviation, industry agriculture, education and security cooperation.

The Working Paper discusses context of the bilateral engagements with the Iranian side on key aspects of bilateral cooperation and also suggests key messages and possible deliverables for the upcoming visit. Ministry of Foreign Affairs has undertaken in-house discussions for concrete input in the form of recommendations with all stakeholders.

The sources said Pakistan will express commitment to Iran-Pakistan Gas Pipeline Project despite all impediments. Both sides need to approach the matter with ‘open mind’ and work out practically feasible solutions to proceed further.

Pakistan will extend an invitation to Iranian side for the second meeting of Technical Committee on IP Gas Pipeline Project.

Key questions vis-a-vis Iran-Pakistan Gas Pipeline Project are as follows: (i) as a follow-up of the first meeting of the Technical Team on IP project in January 2023, Iranian side has repeatedly requested for Plan of Action for Implementation. Ministry of Energy (Petroleum Division) shared progress on the Plan of Action for Implementation; (ii) Pakistan’s political strategy to deal with the matter? Progress so far regarding engagement with the US for seeking exemption on the IP project? Update on finalisation of Letter for the US government? Engagement with the Iranian side on the matter? (progress on the actions assigned by the Steering Committee choired by Shahid Khaqan Abbasi; (iii) Whether Ministry of Energy (Petroleum Division) has any other alternative Plan of Action, like Gas-swap-agreement or any other tangible option to offer to the Iranian side to avoid arbitration; (iv) Pakistan’s legal strategy to deal with the matter? Hiring the Law firm for seeking exemption from the US OFAC on IP Gas Project, progress so far; And (v) in case of arbitration, Pakistan’s preparedness and strategy to contest the matter effectively.

Both countries have discussed possibility of exploring investment projects under a trilateral arrangement between Pakistan, China and Iran.

On July 24, 2023, Ministry of Economic Affairs held an inter-ministerial meeting to review the implementation status of the decision of the 21st session of Pak-Iran Joint Economic Commission as well decisions of the follow-up Committee meeting (held on May 17, 2023).

In this regard, Iran Embassy in a letter of July 10, 2023, requested a list of Chinese companies working in Pakistan’s power sector interested in entering tripartite cooperation with Iran and Pakistan.

It was verbally conveyed that Fekri will be travelling to China to discuss further avenues of cooperation under a trilateral arrangement with the Chinese side soon including tripartite engagement in power sector.

The sources said third session of Pakistan-Iran Joint Investment Committee (JIC) focused on the following agenda: (i) discussion on areas of trilateral cooperation between Pakistan, Iran and China; (ii) discussion to identify and define cooperation models in the field of investment with focus on financial and banking interaction, beside specific discussion on Pakistan Iran (PAIR Investment Company); (iii) exchanging information and investment opportunities between Pakistan and Iran; (iv) discussion on Memorandum of Understanding (MoU) for joint cooperation on establishment of joint free zone on Gabd-Reemdan border; and (v) negotiations on Pakistan-Iran Bilateral Investment Treaty (BIT).

Last month, Pakistan approved bilateral trade with three countries including Iran where banking channels are not available due to international sanctions.

Copyright Business Recorder, 2023