ISLAMABAD, Aug 13: An inter-ministerial delegation will leave on Sunday for China to participate in the first round of negotiations on bilateral Free Trade Agreement (FTA) between the two countries beginning on August 15-16 at Urumqi. Joint Secretary Ministry of Commerce Shahid Bashir would lead Pakistan delegation while the Chinese delegation by the Assistant Minister, Yi Xiaozhun.

An official said that during this meeting the Rules of Origin were expected to be finalized, which were essential to operationalize the Early Harvest Programme (EHP), which was concluded and signed during the Chinese Premier’s visit to Pakistan in April.

The Early Harvest Program (EHP) shall be implemented from January 1, 2006. On its implementation, the Preferential Trade Arrangement between the two countries shall be abolished.

Both the countries had already agreed to scale down customs duty to zero per cent on 1,253 tariff lines latest by January 1, 2008 under the EHP agreement.

Pakistan would reduce duty to zero per cent on 486 tariff lines latest by January 1, 2008 while China will scale down duty to zero per cent on 767 tariff lines under EHP during the same period.

The EHP agreement include two main lists — a common list of items on which both sides will bring the tariffs to zero and a separate list by each country consisting of items of respective export interests on which duties will be reduced to zero.

More than 15 per cent duty will be reduced to 10 per cent by January 1, 2006, then to 5 per cent by January 2007 on the same items and finally to zero per cent latest by January 1, 2008.

Similarly, duty on items in the range of 5-15 per cent will be reduced to 5 per cent latest by January 1, 2006 and finally to zero per cent by January 1, 2007. The items having below 5 per cent customs duty would be scaled down to zero per cent by both sides latest by January 1, 2006.

Most of the Chinese items were in the range of 5 to 15 per cent, which will be subjected to zero per cent duty by January 1, 2007, which would result in surge in Pakistan’s export to China.

According to the agreement, under the common list duties to be brought to zero by both sides: Vegetables — lettuce, peas, beans, olips, garlic. Fruits — oranges, mangoes, kinoes, dates, fig, guava, etc.

Under the agreement China would reduce customs duty to zero per cent for Pakistan on industrial alcohol, bed-linen, table linen & other home textiles, towels, cotton and blended fabrics, synthetic yarn, synthetic fabrics, tarpaulin and marble articles like tiles, etc., surgical goods, sports goods and cutlery etc., certain dyes, guar gum, medicines, leather articles, leather garments, curtains, iron windows and doors.

Pakistan will reduce duty to zero on some organic chemicals, machinery — leather machinery, textile machinery, parts, industrial washing machines, dying machines, machinery for pressing and grinding.