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Pakistan and Uzbekistan will Sign Preferential Trade Agreement to Lower Duties

Tax duties on the three dozen products will be reduced, improving the trade between the two countries.

Uzbekistan President Shavkat Mirziyoyev will sign the Preferential Trade Agreement (PTA) during his two-day visit to Pakistan. Pakistan PM visited Uzbekistan last year, where he finalized the Transit Trade Agreement. The current agreement will cover the trade of 34 goods that contributed $66 million in the trade during the last year. Last year, the import budget was higher than the export budget in the trade with Uzbekistan. But SBP observed the increase in trend amounting to $60 million during the first seven months of the current fiscal year.

Both countries were involved in transit trade through Afghanistan to avoid the hitches. But Afghanistan built barriers in countries’ trade, becoming a major reason for the decline of trade volume as Uzbekistan is a landlocked country. In the PTA, both countries agreed to grant tax concessions on 17 goods by reducing duties from 20-100%. The exemptions in tariffs will be provided based on mutual trade and equality. The federal cabinet will approve the PTA grant the consent to make the deal final with the Uzbek President. Both the countries have also agreed to work together to minimize non-tariff barriers and measures by mutual recognition of standards and to ease procedural requirements for goods.

Pakistan has succeeded in taking export duty exemptions on the cement, plates, bottles, flasks, jars, etc., from Uzbekistan. Uzbekistan has agreed to reduce customs duties by 20% on the import of paints and varnishes, chemicals, mobile phones, confectionery and bakery items, tobacco, cutlery, and mobile phones from Pakistan. Uzbek has reduced the customs duty by 20 percent on importing banana and citrus fruits from Pakistan. In return, Pakistan has agreed to completely waive off custom duty on the import of beans, dried apricots, and groundnuts from Uzbekistan. It has also agreed to a 50% reduction in the customs duty, 100% reduction in additional custom duty, and 25% reduction in regulatory duty on import of sugar confectionery. Trade tariffs also cut down on both countries’ technology items and electronic appliances.

Any country which will face the balance of payment issue can adopt preventive measures for a limited duration. Risks and disputes will be settled down through bilateral negotiations by the joint committee. The agreement will continue for five years with the condition that any country may leave the agreement by issuing the notice of not less than one year before it is due to expire.

Pakistan is engaging itself in the trade agreements after the shift in the National security policy. Business tycoons advised the government to continue trade with New Delhi, considering the trade resumption as an opportunity for political balance in both countries. The economic security in the National Security Policy of Pakistan highlights the importance of the economy to alleviate poverty and unemployment.

Source:

https://tribune.com.pk/story/2346175/pakistan-uzbekistan-to-sign-pta

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