August 28, 2002	Wednesday	Jamadi-us-Saani 18,1423

ISLAMABAD, Aug 27: Pakistan and Afghanistan have agreed to discuss possibility of signing Free Trade Agreement (FTA) to encourage trade between the two countries.

Under the Afghan assistance programme, Pakistan offers commodities assistance to Afghanistan, which includes wheat, flour, sugar, fertilizer and rice.

Both the countries here on Tuesday also decided to establish one-window operation to remove bottlenecks and irritants in Afghan Transit Trade.

The decisions were taken in a joint meeting in which Afghanistan side was led by Foreign Minister Abdullah Abdullah and Finance Minister Mohammad Ashraf Ghani Ahmedzai, while Finance Minister Shaukat Aziz and commerce Minister Abdul Razak Dawood led the Pakistani side.

The meeting discussed introduction of pragmatic and coordinated common tariff policy to discourage smuggling. The Afghan side agreed to examine the proposal.

According to an official announcement, the meeting also discussed various contours of Afghan Transit Trade. Pakistan offered its expertise in increasing appraisement capacity of Afghanistan to increase their revenues, contain illicit trade and to minimize leakages in Afghan Transit Trade.

The two sides further discussed possibilities of escorting convoys from Karachi to Peshawar and to Chaman to discourage pilferage of smuggle-prone items imported by Kabul through Afghan Transit Trade.

It was in principle agreed to take effective measures through tariff rationalization to make Afghan Transit Trade transparent and conducted in a manner that it does not subvert financial interests of Pakistan.

The meeting also reviewed trade between the two countries. During the last financial year, exports from Pakistan to Afghanistan stood at Rs11.6 billion, while imports from Afghanistan to Pakistan were around Rs3.2 billion. The goods in transit for Afghanistan were Rs10.7 billion. Pakistan also facilitated Afghan goods transit to India.

Pakistan offered to send an expert team to Afghanistan for coordinating revenue policies. The two sides agreed that interaction at expert level between the two countries would help formulate concrete proposals for putting in place common tariff to discourage movement of smuggling prone items.

Pakistan further offered project-financing for construction of Torkhum-Jalalabad-Kabul Road. In this regard, it was decided that a team to be coordinated by the Economic Affairs Division and including NESPAK and NHA would visit Afghanistan to make this project Afghan need driven. It was agreed that a feasibility study would be conducted before a decision was made to commission the project. Pakistan also offered supply of buses, tractors, capital goods and machinery to Afghanistan.

Earlier, Mr. Abdullah Abdullah, Foreign Minister of Afghanistan said that he had fruitful discussions with his Pakistani counterpart, which would produce tangible results to the mutual benefit of the two countries.

The Afghan finance minister Mohammad Ashraf Ghani Ahmed Zia acknowledged Pakistan’s support to Afghanistan. He said that Pakistan was the first country to provide budgetary support and appreciated its role in reconstruction of Afghanistan.

He said that Afghanistan would provide level-playing field to all countries to participant in reconstruction of the country. He also said that Afghanistan would benefit from Pakistan’s expertise in networking of post offices.

These proposals would be discussed in the forthcoming session of a Joint Economic Commission meeting to be held in Afghanistan. The two sides also discussed setting up of foreign currency trade only by bank branches as well as representative offices to promote trade services.

Afghan Finance Minister also showed interest in the financial and structural reforms introduced by Pakistan. He said that Afghanistan could benefit from Pakistan’s experience. He also said that Afghanistan was interested in establishing micro credit facilities for social and economic empowerment of Afghani people as it would to a great extent address issue of unemployment there.