ISLAMABAD – Pakistan has evolved a comprehensive package in line with SaudiVision-2030 to promote bilateral trade and investment between the twocountries.
The package envisages measures to ease procedures for business visa, removenon-tariff barriers and initiate talks on a preferential trade agreement(PTA).
The package will be discussed at a high-level forum Saudi-Pak JointMinisterial Commission (JMC) scheduled for Jan 16 (tomorrow). Thecommission will be convened with a delay of more than three and a halfyears as its last meeting was held in April 2014.
Over the past few years, Pakistan’s bilateral trade with Saudi Arabia hasposted a consistent decline, dropping by a half to $2.5bn in 2016-17 from$5.08 billion in 2013-14. One reason is fall in the value of petroleumproducts, which constitute 50pc of total imports.
Pakistan’s exports to Saudi Arabia is on the wane mainly due to a drop inproceeds of rice, fruits, vegetable preparations, apparel and clothing andmade-up articles of textile material.
Minister of State for Finance and Economic Affairs Rana Muhammad Afzal Khantold this scribe that as the Saudi vision envisages transforming itssocio-economic development, Pakistan looks forward to upgrade manpower bysending highly qualified, technical and skilled personnel to Saudi Arabia,especially those working in the automobile and other specialised sectors.
Pakistani workers currently working in Saudi Arabia are semi-skilled orhave no skills.
He listed several opportunities in the halal food sector, cattle farming,milk, fisheries and other agro industry projects for investment by SaudiArabia. The Saudi government will also be requested to set up a refinery inPakistan.
As part of the package, Pakistan will formally offer Saudi Arabia toinitiate a dialogue on a preferential trade agreement. The decision tonegotiate PTA was taken following no breakthrough in the proposedPakistan-Gulf Cooperation Council dialogue on a free trade agreement.Pakistan had only two rounds of negotiations with the bloc since 2006.
The proposed PTA will not only cover tariffs but also non-tariff barriers,and will provide a chance to diversify Pakistan’s export basket to SaudiArabia.
Currently, one of the major components of Pakistan’s exports to SaudiArabia is rice. However, its exports are constantly in decline for the pastfew years.
Saudi Arabia will become the second country after Iran with which Pakistanwill have a bilateral preferential arrangement.
Another important area of the package is to simplify the business-visaregime. Currently, the process of approval involves multiple departmentsand getting the visa takes at least six weeks.
Similarly, Saudi Arabia has increased the business visa fee to Rs74,000 perperson for attending any business activity in the country. This hasdiscouraged a large number of Pakistanis from participating in Saudiexhibitions.
Not a single Pakistani company participated in the Saudi Health 2017exhibition. Pakistan wants this fee to be waived on business visas.
There is another proposal on the table to reactivate interaction betweenthe top chambers body of the two countries. The Pak-Saudi Joint BusinessCouncil was formulated in 2000. So far the body met three times in 17 yearsand thus suggesting a dormant role in promoting business-to-businessmeetings.
It is also under consideration to discuss the timeline to nominate memberson the council and its regulation meetings schedule in the upcoming JMC.
Three more important areas to be discussed at the upcoming JMC are theestablishment of a joint working group on trade, investment and customs. Itwill coordinate with the Saudi ministry of commerce and investment toenhance bilateral trade and investment.
For resolving non-tariff barriers, two important issues will be discussed.The first one will be a mutual recognition agreement to avoid delay incustoms and clearance of Pakistan’s export shipments at Saudi ports. Thesecond issue will be quality assurance certificates to be recognised bySaudi Food and Drug Authority.
To do away with delay, the Saudi government will be asked to simplify theprocess of opening letters of credit at Saudi banks and avoiding proceduraldelays to encourage businessmen to trade
with Pakistan. There are many Pakistani products which are facingdifficulty in entering the Saudi market due to these non-tariff measures.
Secretary Commerce Younus Dagha told this scribe that Pakistan will raisethe issue of removing ban on Pakistan’s shrimp exports to Saudi Arabia. Hesaid Pakistan will also seek licence for State Life to do business in SaudiArabia besides holdings of single-country exhibitions to promote marketaccess for its products in the kingdom.
He confirmed three important areas of the package to be discussed at theJMC talks on PTA, mutual recognition agreement and business visasfacilitation.