Jakarta: Indonesia and Pakistan reach an agreement Free Trade agreement after a span of 10 years.
A long awaited free trade agreement has taken place between Pakistan and Indonesia. According to the Indonesian Deputy Trade Minister Bayu Khrisnamurthi said, “Today, a free trade agreement between Indonesia and Pakistan has been signed”.
Deputy Trade Minister Bayu Khrisnamurthi said on Friday, “adding the agreement will be fully implemented soon. By Sept. 1, trade between Indonesia and Pakistan will be opened up. The immediate potential [trade] from the agreement in 2013 is around $100 million to $200 million”.
The sectors that would play the role for the increase in trade comprises of coal, palm oil, garments, paper products and footwear. Bayu added, “The impact will be greater next year as the agreement could generate an additional $1.5 billion to $2 billion [in trade between the countries] next year”.
According to Bayu, a surplus of $1.1 billion has been booked in gas and non-oil trade with Pakistan and another six months of this year the surplus would amount to $2 million.
An agreement with Pakistan would also ensure access to borders beyond their borders. Bayu said, “It’s not only about Indonesia and Pakistan. The idea is to go up, to Central Asia, talks to establish a free trade agreement between the countries started in 2002. Under the agreement, Pakistan will grant preferential treatment to 287 imports from Indonesia, including cocoa, chemicals, tableware, kitchenware, rubber and wood products”.
Indonesia will provide privileged import duties on 216 products comprising of leather goods, fresh fruit and garments. Also Indonesia proposed scrap duties on oranges and mandarins that are grown in Pakistan.