Kenya expects to sign a Free Trade Agreement (FTA) with Pakistan in about a month's time to avoid losing its largest tea market to India, a top official of the Tea Board of Kenya said on Tuesday.
India, the world's leading producer of tea, aims at sharply increasing its exports to Pakistan, hoping to take advantage of thawing relations between the two neighbours.
Kenya exported 72 million kg of tea worth 9.3 billion Kenya shillings ($120.9 million) to Pakistan in 2003, making it the leading exporter of black tea to Pakistan.
Trade officials have warned Kenya that it risks losing the Pakistan market if it fails to sign an FTA with Pakistan which is concerned about a trade imbalance currently heavily skewed in favour of Kenya.
Pakistan hopes the FTA will enable it to sharply increase its exports to Kenya.
Stephen Nkanata, the managing-director of the Kenya Tea Board, said the Kenya government was responding positively.
"They have looked at (the free trade agreement document) and they think now they can sign," Nkanata said.
"The Pakistan authorities are likely to visit Kenya in March or April and when they come, we hope both parties can sign that trade agreement so that we can continue relying on Pakistan as our key market but they want a reciprocal action."
Kenya had previously been slow to respond to calls for an FTA, fearing a backlash from peasant rice farmers. Pakistan also hopes to increase its exports to Kenya of textiles, pharmaceutical products and leather goods.
"There has not been a lot of initiative from the government side to sign, but I can say for the last one month or so, I have been seeing positive signs from the ministry of foreign affairs and the ministry of trade that they are now finally willing to consider that trade agreement document," Nkanata said.