IRNA – A Pakistan English news daily reported that Iran and Pakistan are likely to finalise the draft for Free Trade Agreement (FTA) during the two-day talks on April 22-23 to be held in Islamabad.
The News in its report said the technical teams from both the sides will hold crucial interaction and are mostly likely to approve the draft for FTA.
According to a senior official at Commerce Ministry, both sides have worked a lot on the draft for FTA and now they are inclined to give green signal to the free trade deal.
At present, the trade between both neighboring countries is underway under Preferential Trade Agreement (PTA) which was signed in 2006 and effective in 2007.
Iran which is the immediate neighboring country of Pakistan has the trade volume of $18 billion with India even in the presence of the US sanctions raising the eye brows as to why not Pakistan has managed to keep the trade with Iran at reasonable level.
India imports from Iran the POL products worth $10 billion. Most of trade between Iran and India is based on barter system
The absence of the banking channels is the single largest obstacle to enhancing the trade between Iran and Pakistan. State Bank of Pakistan and the Central Bank of Iran are also in talks for payment arrangements through banking channels.
Leaders of Iran and Pakistan have already agreed to enhance the bilateral trade volume to $5 billion in the next five years.