Pakistan and Turkey have always had good trade relations. The trade volume between the two countries currently stands at $ 882 million as of FY 2021-22, up by 17.8 per cent from $ 749.12 million in FY 2020-21.
The two countries are all set to increase the bilateral trade by signing an agreement on trade in goods during the forthcoming visit of Turkish Minister for Trade, aimed at achieving strategic goal of bilateral trade of $5 billion in the medium-term. The agreement has been finalised after a lot of deliberation from both sides.
The key highlights of the trade concessions offered by both sides under the Agreement are: (i) Turkiye had offered concessions to Pakistan on 261 Tariff Lines, which include key items of Pakistan’s export interest to Turkiye from both agriculture and the industrial sectors. Concessions on these items would provide Pakistan’s exporters better market access compared to competitors such as India, China, Vietnam, and Malaysia. Out of these 261 Tariff Lines, the Turkish side was offering immediate zero concessions in around 123 Tariff Lines (Customs Duty for Agriculture Products and Additional Customs Duty for Industrial Products), whereas, in 92 Tariff Lines, duty would be reduced to zero in 5 to 10 years. In 5 Tariff Lines, the Turkish side was offering 50 percent reduction, whereas, in 14 Tariff Lines, it was offering a Tariff Rate Quota;
Pakistan had offered the Turkish side concessions in 130 Tariff Lines. Out of 130 Tariff Lines, Pakistan was offering immediate zero duty to Turkiye in only 16 Tariff Lines, whereas, in 16 Tariff Lines, Pakistan was offering zero duty in 5 to 10 years. In the remaining Tariff Lines, Pakistan was only offering a Margin of Preference to Turkiye ranging from 20% to 50%. It is important to note that the Turkish Request List was for 300 items, however, Pakistan had kept 170 items in the sensitive list to protect domestic industry.
The Agreement on Trade in Goods would be an important break-through in improving economic relations between the two countries.
