Speakers at a business forum on Thursday called for enhancing bilateral trade between Pakistan and Iran exponentially. Addressing the forum titled as "Pak-Iran Business Opportunities" Secretary Trade Development Authority of Pakistan (TDAP) Rabiya Javeri Agha said that both the neighbouring counties had been enjoying cordial relations for decades; but unfortunately years-long imposition of international sanctions (on Iran) and cross border issues had hampered the smooth trade and investment activities between the two countries.
She said that the removal of sanctions, along with Iran's growing economy, had resulted in great interest in trade and investment possibilities amongst Pakistani businesses and industries. "We need to improve cooperation and to share trade delegations. People to people contact would also help bring both the counties closer to each other," she added.
The forum was jointly organised by Pakistan Business Council, in collaboration with the Ministry of Commerce, at a local hotel. Rabiya Javery (who presided over the event on behalf of the Minister of Commerce, who was unable to travel to Karachi to attend the event for some reasons) said countries like China, India and South Korea had advanced trade ties with Iran aggressively. Elaborating she said that only China had captured 43 percent of Iran's market with export of some $25 billion. India's export share to Iran stands at $4 billion.
"Trade is about money and trade is about trust," she said and added unfortunately Pakistan and Iran have limited people to people contact. "There is a huge trade transactional gape. Quetta and Taftan Border's situation is deplorable. Road connectivity has been suspended. Smuggling of goods and illegal trade creates trust deficit between each other," she added.
Consul General of Iran in Karachi Mehdi Sobhani on this occasion said that lifting of economic sanctions would considerably improve the country's economic prospective in coming years. "IMF has anticipated that Iran's economic growth would go up to 5.8 percent in 2016 and 6.8 in 2017." the consul general said. The country's gross export will reach to $90 billion in 2016 whereas the imports would go up to $88.6 billion during the same year. He said gross balance of trade would also improve from negative in 2015 to $2 billion in 2016. The increased economic growth will lead Iran's GDP growth from $396.6 billion in 2015 to $416.2 billion in 2016, he added.
Over the next few years, Iran's imports would increase by 50 percent from $75 billion in 2015 to $150 billion in 2025. He said Iran is the 2nd richest economy in Middle East and North Africa. After lifting of sanctions various new opportunities have become available for the foreign trade and investment. He asked the Pakistani traders/exporters to step up to enhance the current trade volume between the two Muslim countries. He said Pakistan has some commodities in surplus which can be supplied to Iran.
Ashraf Khan, Executive Director Operations, State Bank of Pakistan on this occasion said that after the removal of international sanctions, both the Central Bank of Iran (CBI) and SBP were in close co-ordination with each other to address the banking related issues.
He said that Government had formed a joint working group wherein SBP, CBI, Ministry of Finance, commercial banks' officials were working together to immediately restore the banking linkages.
Speaking at the session, Chairman PBC Atif Aslam Bajwa said that Pakistan's top potential exports to Iran were rice, cotton and Petroleum Preparations; with a potential of $1.6 billion, $123 million and $100 million, respectively. He also spoke about the potential trade with Iran that Pakistan must utilise, as currently Iran is taking far greater advantage of the existing Preferential Trade Agreement, leading to a great disparity in Pakistan's imports and exports. He also advised Pakistan exercises caution before signing any trade agreements, to avoid this current trade situation with Iran occurring again.
The Business Opportunities Forum is a follow-up to the recently published Iran Study by the PBC as well as setting the scene for President of Iran's visit to Pakistan. CEO and Managing Director Pak-Iran Investment Company Limited (a joint venture between the Governments of Iran and Pakistan), Nadeem Karamat and Logistics and transport expert Babar Badat also gave a brief presentation on the topic. Trade specialists and leaders of the business community also attended the event.
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