ISLAMABAD, Sept 6: Pakistan will hold first round of talks on a free trade agreement (FTA) with the European Free Trade Association (EFTA) to increase the level of trade with the bloc.

The EFTA comprises Switzerland, Norway, Iceland and Liechtenstein. The global imports of EFTA are around $180.36 billion and its imports from Pakistan are only $98.45 million.

An official told Dawn on Thursday that that a high-level official delegation will leave next month for Switzerland to initiate formal talks on the draft text of the agreement with the bloc in the Geneva-based headquarter of the association.

Pakistan had formally requested for having treaty with EFTA in a meeting with Swiss Undersecretary of State Ms Monika Rohl Burzl during her visit to Pakistan in February last. The Swiss government help was also sought in initiation of talks on free trade area.

The two sides will discuss products for duty reduction, rules of origin, besides reaching an agreement on the draft text of the treaty.

Islamabad’s current level of trade balance is heavily in favour of EFTA countries, and within EFTA, Switzerland is the largest trading partner of Pakistan. The proposed free trade agreement with EFTA will provide increased market access to Pakistani goods and services and, similarly, import of machinery will be made at concessionary rates.

The official said the EFTA Council had already discussed the issue once and formally conveys the decision to start negotiations with Pakistan on goods and services.

Switzerland also offers the GSP (Generalized System of Preferences) facility to developing countries including Pakistan, under which exports to Switzerland are offered tariff reduction from MFN (Most Favored Nation) duties.

Currently 92 per cent of Pakistan’s export to Switzerland benefit from this scheme.

Pakistan’s current level of trade balance is heavily in favour of EFTA countries and within EFTA, Switzerland is a largest trading partner of the Pakistan.

Bilateral trade between Pakistan and Switzerland is US$ 508 million with Pakistan’s imports of $37 million of textiles, carpets, surgical instruments, etc.

Textile remains the largest item of export to these countries, particularly Switzerland. Some traditional products, like sports goods, surgical equipment and carpets also have minor export share in these countries.

There is a great scope that bio-products offer the best opportunity for Pakistani exporters to Switzerland, as these products are in great demand and most are imported.

Some examples of products that Pakistan should consider are bio-rice, bio-mangoes or bio-cotton, giving particular attention to certification and control of bio brands and quality of products.