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sibgakhan · #3 Friday, February 03, 2006

Pakistan to seek early finalization of BIT: PM’s visit to US

ISLAMABAD, Jan 13: Pakistan will urge the United States for early finalization of the much-awaited Bilateral Investment Treaty (BIT), which will lead to initiation of a dialogue on signing of a free trade agreement (FTA) between the two countries.

An official told Dawn on Friday that the issue among others would be discussed during the upcoming visit of Prime Minister Shaukat Aziz to Washington later this month.

The premier would discuss with the US authorities the current position of the BIT and its early finalization. The signing of BIT would provide a platform for the initiation of talks on the FTA.

Meanwhile, a US official delegation was arriving here on January 18 to hold final round of talks with the Pakistani authorities to finalize the remaining controversial articles of the BIT.

According to the official, Pakistan was also seeking additional market access from the US for its textile products which were currently facing high tariffs.

Pakistan will also seek the inclusion of more items in the US generalized system of preference (GSP). The US restored 14 tariff lines (products) of Pakistan in its GSP scheme in July 2005.

According to the official, the delegation would again raise the issue of establishment of qualified industrial zones (QIZs) with the US authorities in tribal and other terrorist prone areas to reduce the incidence of poverty.

Islamabad is seeking a similar arrangement of the Israel-Jordan QIZ for both Pakistan and Afghanistan to generate employment opportunities in remote areas.

Under this arrangement, products produced in such zones could be exportable to the US market duty free or at preferential customs duty. The benefit derived from the QIZs could be shared appropriately between Pakistan and Afghanistan, added the official.

In the QIZs, Pakistan could unilaterally establish factories or could establish in collaboration with the Afghan government, particularly in Afghanistan.

The official said Pakistan had proposed special trading arrangement for economically-depressed regions, particularly the tribal areas of the country as well as working with the US for economic development of Afghanistan.

A study recently conducted in Pakistan showed strong correlation between extremism and incidence of poverty in the country. The official said that under the proposed plan, the government had also decided to involve the private sector to address poverty issues in economically-depressed regions.

However, the official said that in case the US promised a preferential market for Pakistani products, this would create an incentive for the private sector to invest in these regions, create employment and generate economic activity.