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Four agreements to be signed with Iran

February 19, 2005

ISLAMABAD, Feb 18: Pakistan and Iran will sign four important agreements, including the Additional Protocol to the existing Preferential Trade Agreement (PTA), during Prime Minister Shaukat Aziz's visit to Tehran next week , Dawn learnt through diplomatic sources.

The prime minister is scheduled to visit Iran from Feb 22 to 24. This will be his first visit to the country since assuming office in August 2004. A key issue to be discussed during the visit would be import of additional electricity from Iran. Pakistan is already purchasing electricity from Iran for Balochistan and is interested in buying more for the border areas and Gwadar.

The signing of the Additional Protocol to PTA, which was concluded between the two countries in March 2004, is seen as a major step to make PTA effective in enhancing bilateral trade.

Other agreements to be signed pertain to a joint investment company for export of fruits; anti-narcotics; and transportation links, specifically increasing the frequency of the bus service between the two countries.

The main thrust of the Iran visit will be strengthening bilateral relations by enhancing trade and economic cooperation, sources said, adding that in this context the trans-Pakistan gas pipeline to India will figure prominently in the discussions as will be the possibility of other joint infrastructure ventures.

The federal petroleum minister, Amanullah Jadoon, will be accompanying the prime minister to give his input at the talks on this particular subject. Pakistan hopes to carry forward the pipeline project to fulfil its growing energy requirements.

After India's decision to treat it as a stand-alone project this will be the first opportunity for Iran and Pakistan to have discussions on the possible terms and conditions for what now appears to be trilateral agreement.

India has apparently indicated that it would buy gas on the border on take-and-pay basis with sovereign guarantees reflecting the principle of deliver or compensate.

The Indian petroleum minister is scheduled to visit Iran in June and is expected to visit Pakistan earlier to discuss various aspects of the gas pipeline project.

Pakistan and Iran have been keen on the 4.5 billion dollar gas pipeline project all along and had decided that in case India did not give a clear signal by November they would go ahead with it.

The petroleum secretary will also be leaving for Tehran on Sunday for the two-day Pak-Iran Joint Economic Commission (JEC) meeting that will precede the prime minister's visit. The commission will focus on promoting economic cooperation through increased trade volume, officials said.

The two-way trade between Pakistan and Iran stands at US $376 million which is heavily tilted in favour of Iran with Pakistani exports to Iran amounting to $92 million. At the JEC meeting, Pakistan will therefore seek to correct this imbalance.

In Tehran, the prime minister is slated to have a round of talks each with Iranian President Seyed Mohammad Khatami and the vice-president on Feb 22. The following day he will call on the Iranian spiritual leader, Rahbar Seyed Ali Khameni. The premier's talks with the Iranian leaders would focus on bilateral relations as well as regional and global developments.

Given the US-Iran standoff over Tehran's nuclear programme and Pakistan's concern about it as an immediate neighbour of Iran, this is bound to top the talks agenda. Pakistan is against military action and has been advocating diplomatic solution to the issue.

Sources said the prime minister was expected to press the Iranian leadership to avoid confrontation just as it has been calling upon the US and other Western countries to give diplomacy a better chance. Pakistan supports the current engagement between Iran and EU-3 that is aimed at reaching a broad and amicable agreement with Iran.

Iran has been under tremendous pressure from the US over its nuclear programme. Pakistan's position on the Iran nuclear issue is that as a signatory to the Non-Proliferation Treaty (NPT) Tehran's legitimate right to its peaceful nuclear programme consistent with its commitment to other NPT non-proliferation obligations should be protected.

During his Iran trip the prime minister will also visit Isphahan and Mashed. His visit is seen as a continuation of high-level exchanges between the two countries following President Khatami's visit to Pakistan in December 2002.

Iranian foreign minister Kamal Kharazai visited Pakistan in December 2004. Former prime minister Mir Zafarullah Jamali visited Iran twice, first in October 2003 and then in 2004. Pakistan's foreign minister Khurshid Kasuri visited Iran in August 2004. Earlier, first vice-president of Iran Mohammad Raza visited Pakistan in March 2004.

Pakistan shares an almost 8,776 kilometre long border with Iran and considers it a very important immediate neighbour. Soon after assuming office, Prime Minister Aziz had told Dawn in a panel interview that on the foreign policy front his priority would be to consolidate relations with Iran.

Under the technical assistance programme, Pakistan is offering 28 scholarships to Iranian students in its professional institutions for MBBS, BDS, Pharmacy and BS engineering. Pakistan-Iran relations have improved since the fall of the Taliban regime in Afghanistan after 9/11.