Pakistan, China eyeing $8bn trade by 2008

BEIJING, Oct 4: Pakistan and China enjoy bright prospects to take their bilateral trade volume to around $8 billion by the end of 2008, when tariff on most items would be reduced to zero under the Early Harvest Programme (EHP).

By 2008 we are confident to achieve this target, since the two countries registered a rapid growth in their trade interactions in the recent years, said a senior Pakistani official here on Tuesday while talking to APP.

According to Chinese Custom data, bilateral volume of trade is expected to touch $4 billion by the end of this year, since the growth rate, registered in seven months from January to August, 2005 was around 42 per cent, as compared to the corresponding period.

The increase in the trade was amounted to about $600 million during this period. “We are quite optimistic, expecting a big jump in trade volume taking it to $8 billion within next three years, since Pakistan starts exporting rice, mango, orange and some other food products to China from this year,” the official said.

The EHP, signed in Islamabad April this year, will be effective from January next, bringing zero per cent duty on more than 50 import-export items, already identified by the two countries. It is the part of the Free Trade Agreement, likely to be finalized soon. Second round of the negotiation to this effect is scheduled to take place in Islamabad next month.

The existing Preferential Trade Agreement (PTA) on which China and Pakistan had reduced tariff on margin of preference i.e. a percentage of the normal tariff, has also been extended. This list consists of 1,671 items on the Chinese side and 575 items in the list of Pakistan will become part of the EHP from January 1, 2006.

Leadership of the two countries recognized that their bilateral trade was nowhere near their potential and matched their exemplary diplomatic ties. They have now laid greater thrust on the development of mutually beneficial economic partnership.

Pakistan Embassy here in collaboration with Pakistan Export Bureau and Chinese foreign trade promotion organizations held a number of business conferences, seminars and meetings during the last three years, providing venues to their entrepreneurs enhance their interaction and take benefit of the growing trade prospects in their respective countries.

According to the sources Pakistan would be facing a major challenge to correct balance of trade, which is currently heavily in favour of China. Pakistan would rely upon on the export of its agro-based products, which can easily find a big market in a country, having a population of 1.3 billion.

Particularly, the export of Pakistani rice to China is likely to be a breakthrough in trading food items. “The Pakistani long-grain rice can find a big market in China, since its quality is much better than the rice currently being imported from Thailand and Vietnam,” the official said.

China purchased about 400,000 tons Thai rice last year. The Chinese Commerce Ministry has planned to import more rice in coming months due to decline in production and stocks.—APP

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