ISLAMABAD: Pakistan is awaiting a response from Russia on the proposed estab­­lishment of a Joint Business Council (JBC) to enhance bilateral trade.

“We have already exchanged a draft with Russia on the establishment of the council and are awaiting a memorandum of understanding (MoU) from Russia on the JBC,” an official of the commerce ministry told Dawn on Monday.

In 2004, Pakistan initiated negotiations on a Preferential Trade Agreement (PTA) leading to a free trade agreement (FTA) with Russia. Back then Russia was not a member of the World Trade Organisation (WTO), therefore, Moscow could not enter into a PTA/FTA arrangement with Pakistan. Moscow became member of the WTO in 2012.

According to the official, Russia was again approached for the PTA/FTA but the response was rather cold. In 2012, Russia informed Pakistan that as a member of Customs Union, Russia has to get prior permission from partner countries for initiation of talks on PTA/FTA.

Pakistan, according to the official, is also awaiting a MoU on the issue of exporters’ claims against the Russian federation.

Prior to these agreements, the Ministry of Commerce also prepared a strategy to explore the Russian market.

The ministry is working on modalities to participate in the World Food Exhibition 2015 in Moscow, and also arrange single country exhibitions to lure foreign exporters.

The ministry is also working with stakeholders to identify exportable edible products, keeping in view surplus quantities and requisite quarantine arr­angements are met with.

In this regard, the source said that officials of the commerce ministry will meet fruit and vegetable exporters in Lahore in a couple of days.

The meeting will discuss mode of payment for the trade as well.

In the prevailing condition, the official said the transactions payment will be a big issue as Russian currency has devalued tremendously in the past few months.

“We will discuss ways and means for resolving this crucial issue, including consideration of currency swap arrangement with Russia,” the official commented.

Russia has been importing food items worth $35 billion from around the world, particularly European countries.

The ban on imports is creating a space of $16bn which should be captured and certainly we would like to have a share in this available market, the official remarked.

Pakistan has a sturdy agriculture sector which contributes 21 per cent to Gross Domestic Product.

“We can provide incentives to this sector to further prosper if we find new export destinations for our products,” the official added.

Published in Dawn, December 30th, 2014