Signing of nine agreements/ MoUs between Pakistan and Turkey is doubtful during the one-day official visit of Turkish Prime Minister Recep Tayyip Erdogan, as economic ties between the two countries plummeted after the scrapping of contract with Karkey Rental Power Plant in the light of Supreme Court's landmark judgment.
The Turkish Prime Minster is visiting Pakistan at a time when his government has reportedly expressed anger at the government of Pakistan, especially the Ministry of Water and Power, for what it regards as the mishandling of the issue of Karkey Karadeniz Electric Uretum AS.
"We are under severe pressure to resolve the issue of Karkey but we have conveyed to the Presidency that the Supreme Court has declared the project as null and void because it felt that the contract was not transparent," sources close to the Secretary of Water and Power said.
The fourth round of Joint Ministerial Commission (JMC) to be co-chaired by the Commerce Ministers of both the countries will be held on Monday (today) to discuss various issues, including investment.
Officials told Business Recorder that on the sidelines of JMC meeting, the fourth round of PTA negotiations will be held. A clause is expected to be included in the proposed PTA between Pakistan and Turkey that provides for PTA partners to be excluded from safeguard duties imposed by either country. Turkey has already excluded its FTA partners from safeguard investigations.
Both sides will discuss energy production and tariff issues pertaining to energy projects with Zorlu Energy and M/s Karkey.
The sources said fresh proposals in auto industrial production, SME, telecommunication, agriculture, culture and tourism, education and vocational training, mining, communication, energy and hydropower will also be discussed.
Turkish side is also interested in extending export credit of $100 million to Pakistan for the export of goods and services to Pakistan, the sources added.
In order to operationalise road transport agreement signed between the two countries in 2003 which have been ratified by both, certain protocols need to be signed. Drafts related to 'protocol on transit routes and technical requirements of road vehicles' and protocol on the customs and other procedures' have already been forwarded to Turkey. An effort would be made to finalise both these proposals.
Mechanism for adherence to time schedule of Economic Co-operation Organisation (ECO) and its monitoring mechanism at the level of ECO secretariat will also come under discussion with a view to enhance its utility for the business community.
During the last ECO meeting with Turkey, the Turkish side invited the Pakistan side to become members of Intergovernmental Organisation for international carriage by rail which will facilitate trade between Pakistan and Turkey.
The summary for permission to acquire membership of OTIF has been submitted to the Cabinet and on approval from Cabinet OTIF's membership will be acquired.
Possibility of joint venture in the field of sea transportation including dry and wet cargo, construction of ship for PNSC at Turkish shipyard through non interest/ soft loans from Turkish banks/ shipyards and up gradation of dry dock facilities at Port Qasim through bilateral arrangement between PQA and Turkish side will be explored.
MoUs and agreements which are likely to signed at a meeting of High Level Co-operation Council jointly presided over by both the Prime Ministers, are as follows: (i) A framework document between the Ministry of Transport, Maritime Affairs and Communication of Turkey and Ministry of Communication of Pakistan; (ii) a protocol on co-operation in the field of archives; (iii) an MoU on co-operation in the field of renewable energy ; (iv) another MoU in the field of urbanisation; (v) an agreement on reciprocal promotion and protection of investment; (vi) another agreement for scientific co-operation between Pakistan and Science foundation and Turkish Academy of Sciences; (vii) an executive protocol for scientific co-operation between Pakistan Academy of Sciences and Turkish Academy of Sciences; (viii) renewal of the protocol technical co-operation between PSQCA and TSC; and (ix) a protocol on the fourth meeting of the Turkish and Pakistan Commission on Tourism.
The sources said, both sides agreed in principle to initiate Pak-Turkey Free Trade Agreement (FTA) negotiations.
According to sources, Pakistan is trying to quickly conclude PTA with Turkey. The Third round of PTA negotiations was held in Ankara, Turkey on 13-14 October 2011 under the framework agreement on PTA.
The sources said that Turkey had pledged $100 million during the Tokyo donors conference, with $10 million already disbursed as budgetary support; $4 million was deposited in the Muti-Donor Trust Fund (MDTF) administrated by the World Bank while the balance amount of $85 million spent on development of projects/ programs through TIKA.
Turkey also provided generous support for the rehabilitation and reconstruction work in the wake of October 8, 2005, earthquake. Turkish Prime Minister, Erdogan visited Pakistan in the same month and toured the affected region.
Turkey committed $172 million for relief and rehabilitation efforts out of the total amount $30 million received in the President's relief fund, $100 million was spent on humanitarian aid and the remaining $42 million was spent on construction of administrative complex Islamabad.
In addition to this, a co-operation protocol between Pakistan and Turkey has been signed on March 20, 2012 for utilisation of $140 million, pledged by the Prime Minister of Turkey for disaster affected areas of Pakistan. The amount will be utilised by Housing Development Administration (TOKI) through 'Siyahkalem' for construction of 4,620
houses in Punjab and Sindh.