Pakistan News

Accord with Iran to boost trade, energy ties

Accord with Iran to boost trade, energy ties

ISLAMABAD: Pakistan and Iran pledged on Friday to boost their trade ties and energy cooperation in an attempt to turn a new page in their relations after lifting of sanctions against Iran.

The agreement was reached as Iranian President Hassan Rouhani, who is leading a large political and economic delegation, including 60 businessmen, opened a two-day visit to Pakistan with a meeting with Prime Minister Nawaz Sharif.

Mr Rouhani’s visit is aimed at giving a fresh impetus to bilateral relations following the end of nuclear-related curbs on Iran. Energy cooperation and increased trade are envisaged to be the cornerstone of the new phase in ties when the two sides try to make up for lost opportunities.

Besides trade and economic issues, Mr Rouhani intends to address regional issues which are of common concern to the two countries. In a Twitter posting before leaving Tehran for Islamabad, he said: “On way to Pakistan to discuss important regional and global issues and explore opportunities for constructive engagement.”

The two leaders, following their one-to-one meeting and delegation-level talks, appeared before television cameras to deliver short statements.

“Our trade and economic ties have suffered due to sanctions. We have agreed to strengthen our bilateral ties in diverse areas of trade, economy and energy,” Mr Sharif said.

The Iranian president said the discussions centred on diversification of trade and economic relations and exploring new opportunities of cooperation in the energy sector.

The two sides decided during the meeting about opening new border crossings, besides the possibilities of cooperation between Gwadar and Chabahar ports, which are seen as rivals, export of electricity from Iran to Pakistan, and signing of trade agreements.

A memorandum of understanding (MoU) on a five-year strategic trade cooperation plan was among the six agreements signed by the two sides. The other accords pertained to insurance, culture, health and research.

The current volume of bilateral trade is mere $250 million. The two countries have set an ambitious target of taking this to $5bn in five years.

There was, however, no word on the struggling Iran-Pakistan gas pipeline project, which had been held up because of the sanctions, but which both sides see as important for their cooperation.

Mr Rouhani also mentioned counter-terrorism cooperation, saying both countries considered each other’s security as important. He said there was a shared resolve to defeat extremism and terrorism.

Intelligence, security, and border cooperation are also on Mr Rouhani’s agenda.

He called for political solution to regional problems and conflicts.

Although the two countries do not have political disputes in their relationship, most of the time they find themselves in opposite camps in regional politics, which makes bilateral cooperation much more difficult.

The Iranian president will meet President Mamnoon Hussain and co-chair a business session with the prime minister on Saturday.

According to APP, the prime minister, during the joint press stakeout with President Rouhani at the PM House, said the two sides had decided to open two additional border crossing points to encourage trade and economic interaction as well as to facilitate people-to-people contacts.

The Iranian president said they had also deliberated on ways to boost bilateral business by means of preferential trade and move forward for a free-trade agreement.

The possibility of sea trade through Gwadar and Chabahar ports was discussed.

“There is a will and resolve to combat extremist and terrorist groups and not to allow such elements to shatter peace in the region,” Hassan Rouhani said.

The Iranian president said the two sides needed to enhance their cultural relations as well as regional cooperation.

Published in Dawn, March 26th, 2016

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