ISLAMABAD, Feb 9: Pakistan and Sri Lanka on Wednesday called for an early holding of a Saarc summit in Dhaka to give boost to regional development and strengthen ties in the field of trade and economy.

Talking to reporters after their formal talks at the PM House here, Prime Minister Shaukat Aziz and President Chandrika Kumaratunga agreed on the need to make more efforts to hold the summit as soon as possible.

"Certainly, we are in favour of an early holding of the summit and we will do our best to help its reconvening as soon as possible," the Sri Lankan president said.

Prime Minister Aziz said that Pakistan was endeavouring to convene the summit at the earliest to give further momentum to the process of Saarc for regional cooperation.

"Pakistan wants the Saarc process to move forward and further strengthened," he added.

The two leaders held a one-to-one meeting before they were joined by their respective sides.

Officials told APP that the two leaders expressed their disappointment at the postponement of the Dhaka summit.

Prime Minister Aziz emphasized that it was important that the process of Saarc should not be stalled as a result of postponement of the summit.

President Kumaratunga assured Prime Minister Aziz of her country's full support in this respect.

The prime minister described talks with the Sri Lankan president as productive that covered all areas of bilateral interest.

Pakistan and Sri Lanka also signed four accords and two MoUs, including a free-trade agreement (FTA) that would open a new chapter of economic cooperation between the two countries.

The prime minister described the signing of FTA as historic and said it would be a 'turning point' in the economic ties between the two South Asian states.

He said the two sides had agreed to hold a meeting of the joint economic forum in Colombo in April and Pakistan had also proposed to hold a single-country exhibition in the Sri Lankan capital at the same time that would give further momentum to the FTA process.

The two sides also signed an agreement on exempting students from visa fees, a memorandum of understanding for technical assistance in gems and jewellery and cooperation in agriculture, along with an agreement on a 10-million-dollar credit facility for Sri Lanka.

President Kumaratunga noted that it was the first such agreement Pakistan had signed with another country and promised to make it operational as early as possible as well as a success for the mutual benefit of the two countries.

The prime minister told the Sri Lankan president that Pakistani people shared the tragedy of tsunami that claimed many lives in Sri Lanka.

Mr Aziz said the two countries also agreed that Pakistan would help re-build two mosques that were damaged by the De 26 tsunami in Sri Lanka.

The Sri Lankan president thanked President Pervez Musharraf, Prime Minister Shaukat Aziz and the Pakistan government for early assistance in this respect. She recalled that the two countries had maintained excellent bilateral relations and that her country continued to attach high importance to maintaining and strengthening these ties.

President Kumaratunga was confident that her two-day talks with the Pakistani leadership, Prime Minister Aziz's recent visit to Colombo and future activities between the two countries would help further consolidate these relations. The friendship between the two countries would continue to grow in future, she added.

Responding to a question, Prime Minister Aziz said that talks focussed on the FTA, an early warning system against natural disasters like tsunami, holding of an early Saarc summit and increasing economic ties between the two countries.

In reply to a question, he said the FTA was not a threat to Safta and the two were rather complementary to each other.

He described the FTA as a stepping stone in promoting economic ties between the two countries. This agreement, he added, could serve as a model for economic cooperation for other countries.-APP