Pakistan and Iran signed 39 memorandums of understanding this week to expand bilateral commerce, strengthen economic connections, and benefit from each other’s resources and skills in transportation, tourism, fisheries, and minerals. The signing ceremony took place after the two-day meeting of the two countries’ Joint Boundary Committee.
The decline in exports and rise in imports, which are contributing to a growing trade deficit, are two factors in the bad status of the nation’s economy. The need to import the raw materials required by domestic factories accounts for this, and there are two to four factories that run the risk of going down to a lack of supplies. This prevents the import-export balance from being established, which would inevitably have a detrimental effect on the country’s economy. The administration is aiming to increase trade with nearby nations as one of its solutions to this issue. Fortunately, Pakistan is situated in a region with the Muslim republics of Central Asia, with which it has long-standing trading relations, on one side and the Middle East, Iran, and Afghanistan on the other. Pakistan suffers from commerce with far-off western nations; yet, if trade ties are developed with its neighbours, numerous products can be easily obtained and exported to these nations. Particularly significant in this regard is Pakistan’s commerce with Iran. The expansion of bilateral trade is of great relevance to both nations.
Among other things, it was agreed that Quetta and Zahedan businesses will make collaborative investments to construct the essential infrastructure in the domains of customs, trade, transportation, and airline. Tariffs will be cut and the number of trade products raised. The two countries agreed to expand their bilateral trade volume to $5 billion each year. Attempts will be made to achieve a trade balance. The MoU also includes the creation of new common markets at the borders. It was also determined that Pakistan and Iran should negotiate a free trade agreement to facilitate the purchase, sale, and exchange of goods.
A corridor deal will be signed to transport commodities and trade from Iranian territory to Turkey, Azerbaijan, and other countries, thereby promoting bilateral trade. Vehicles carrying goods will not require a Kovisaya permit. Ferry service between Pakistan and Iran will also be provided. The trade memorandum of understanding also outlines several other steps that, if followed, may result in a huge economic revolution in the region from this trading cooperation following the China-Pakistan Economic Corridor. Although there are some problems in this topic, they are readily addressed with both countries’ determination.
