ISLAMABAD, Feb 17: Pakistan and Palestine on Sunday agreed to form a joint commission comprising foreign ministers of the two states to expand bilateral ties in economic, agricultural, banking, social and cultural sectors.

The commission would begin its work soon, President Asif Ali Zardari told his Palestinian counterpart Mahmoud Abbas when during a meeting at the presidency the latter expressed the desire to take bilateral cooperation to new areas.

President Zardari offered a $1 million grant for construction of Palestinian embassy in Islamabad, according to his spokesman Farhatullah Babar.

The two sides held two rounds of talks — one meeting involving the two presidents and the other their delegations.

“The talks covered a host of issues, ranging from the ongoing struggle of the Palestinian people for statehood to bilateral issues and from the Middle East situation to the stalled Palestine-Israel peace process,” Mr Babar said.

This is the first visit to Pakistan by President Abbas after recognition of Palestine as a non-member observer state by the United Nations. Pakistan was co-sponsor of a UN General Assembly resolution that granted this status to Palestine on Nov 29.

Issues relating to the Palestine-Israel relations, with focus on continued construction of settlements by Tel Aviv, and reconciliation within Palestine also figured prominently in the talks.

During the meeting President Zardari said that Pakistan believed in the Palestinians’ and the Kashmiris’ inalienable right to self-determination. He underlined the need for evolving a global consensus on ways to resolve the two conflicts.

The president called for withdrawal of Israelis from the occupied Arab territories including Jerusalem, an end to construction of settlements, and establishment of an independent homeland for Palestinians with Al Quds as its capital.

“Pakistan strongly condemns the building of illegal settlements in the occupied territories and calls upon the international community to stop Israel from building settlements to the east and south of occupied East Jerusalem,” he said.

Mr Zardari expressed concerns over Israel’s act of ridiculing the UN and said its behaviour was against international law but ‘champions of justice and human rights’ had raised no objection over it.

Pakistan would continue to extend unwavering support to the Palestinian people till the establishment of an independent Palestinian state, he said.

He expressed joy over grant of status of non-member observer state at the UN to Palestine and noted with pride that Pakistan played a pivotal role in the process.

Mr Zardari said Pakistan had supported every effort for resolving the Palestine-Israel dispute in accordance with the UN resolutions to ensure lasting peace in the region. He expressed confidence that under the leadership of President Abbas the people of Palestine would bravely confront the challenges being faced by them.

He recalled that the Palestinian Liberation Organisation was first recognised as the legitimate representative of the Palestinian people at the Islamic Summit in Lahore in February of 1974 which also led to the establishment of diplomatic relations between Pakistan and Palestine. President Abbas briefed his Pakistani counterpart on Israel’s use of the division between the West Bank and Gaza strip to renege on the peace process and the antics resorted to by Tel Aviv after Palestinian leadership undertook efforts for achieving national reconciliation.

Since 1988, he said, the Palestinians had accepted the two-state solution as a basis for ending the Palestine-Israel conflict and added that they would continue to work to realise this goal through negotiations.

However, he deplored, the solution was becoming increasingly unattainable because of Israel’s unacceptable settlement policies.

President Zardari was also briefed on the Arab peace initiative that, President Abbas said, also addressed the Israeli concerns but had been ignored by Tel Aviv.

The initiative revolves around recognition of Israel by Arab and Islamic countries on the basis of the 1967 borders, a just and agreed upon resolution of the refugee issue and a collective regional security framework to safeguard the agreement in future.

The Palestinian president thanked Pakistani government for its initiative to build Palestinian embassy in Islamabad. The gesture, he said, underlined strength of their bilateral relations.

Later, the two presidents unveiled a plaque of the foundation of the embassy.

The Palestinian delegation included Foreign Minister Riad N.A. Malki, Ambassador in the Presidency (Ramallah) Majdi A.M. Khalidi, the president’s adviser Nabil G.O. Aburubainah and Walid A.M. Abu Ali, ambassador in Pakistan.

The Pakistani delegation included Foreign Minister Hina Rabbani Khar, Interior Minister Rehman Malik, Minister for Textile and Industry Makhdoom Shahabuddin, Foreign Secretary Jalil Abbas Jilani and Lt Gen (retd) Ahsan Azhar Hayat, ambassador designate to Palestine.

Prime Minister Raja Pervez Ashraf and PPP chairman Bilawal Bhutto Zardari also attended the talks between the two delegations.

President Abbas last visited Pakistan in February of 2010.