Domestic Economy

Iran, Pakistan Open Border Market to Bolster Commerce

Located in Pakistan’s Balochistan Province, the Pashin marketplace is the first of six to be built along the Pakistan-Iran border under a 2012 agreement signed by the two sides
Iran, Pakistan Open Border  Market to Bolster Commerce
Iran, Pakistan Open Border  Market to Bolster Commerce

The top leaders of Pakistan and Iran on Thursday inaugurated the first border market, as relations warm between the two countries, officials said.
Located in the remote village of Pashin in Pakistan’s southwestern Balochistan Province, the marketplace is the first of six to be constructed along the Pakistan-Iran border under a 2012 agreement signed by the two sides, the Associated Press reported.
Pakistani Prime Minister Shehbaz Sharif and Iranian President Ebrahim Raisi also inaugurated an electricity transmission line, which will provide some of Pakistan’s remote regions with Iranian electricity.
In a televised meeting, Sharif assured Raisi that Pakistan would do its best to improve security along the Iranian border. He added that both sides agreed to enhance trade and economic ties, and extended an invitation to Raisi to visit the Pakistani capital, Islamabad.
Iran-Pakistan relations have been contentious because of cross-border attacks by Pakistani militants along the shared border.
This is the first visit of its kind since 2013, when the two nations signed an agreement allowing Pakistan to import Iranian gas despite American opposition. Tehran at the time said “the West has no right to block the project.” The agreement could not be implemented, because of US sanctions on Iran.



Effort to Boost Trade Ties

Pakistani newspaper Dawn wrote that for numerous reasons, mostly geopolitical, Pakistan’s trade volume with its neighbors — with the exception of China — is very low. 
Trade ties with Iran have been particularly lukewarm, mostly due to the fear of attracting American and Saudi wrath. However, small steps are being taken to enhance commercial relations with Iran, including the opening of Mand-Pishin border market. 
It is hoped these steps are followed up with more concrete efforts to deepen trade relations. 
The border markets will hopefully help promote much-needed economic activity in Balochistan and should help formalize border trade. As it is Pakistani cities, particularly Karachi, Islamabad and Rawalpindi, are flooded with smuggled Iranian products. Formalizing trade will help bring in tax revenue, while also opening up the Iranian market to Pakistani products.
Along with promoting trade ties, officials on both sides need to resolve the controversy over the Iran-Pakistan gas pipeline. While the Iranians have constructed the pipeline on their end, Pakistan has yet to build its part. As a result, Iran may take Pakistan to court, with the country facing a $18 billion penalty for failing to complete the project. 
The matter was discussed in the Public Accounts Committee on Wednesday, with the PAC chairman remarking that “the US should pay the penalty” if it stops Pakistan from completing the pipeline, pointing to the widely-held belief that the fear of offending Washington is preventing Pakistan from honoring its commitment.
Pakistan can ill afford to pay such a massive penalty. Reneging on the deal will reflect badly on its shaky international standing, and damage ties with Tehran. The state should make it a priority to address the pipeline issue, and assure Iran that it intends to honor the deal. If the price of gas is right, it would be a win-win situation for all, as Pakistan needs affordable hydrocarbons. 
The Saudis should have no concerns, as they are mending fences with Iran, while our friends in Washington must be told that Pakistan has to honor the pipeline deal. If the US can look the other way when India and others buy oil from sanctioned Russia, it should have no issues if Pakistan buys gas from Iran, and enhances trade relations with it. 
Eurasian integration is the new buzzword and if Pakistan fails to hop on the bandwagon of regional trade for fear of offending powerful actors, it will have only itself to blame.



Pakistan-Iran FTA Soon: PM

Sharif on Thursday said Pakistan and Iran had decided to finalize the Free Trade Agreement soon to exploit the immense potential in trade and investment, Daily Times reported.
Bilateral ties and cooperation were discussed in a meeting between Sharif and Raisi after the two leaders inaugurated the Mand-Pishin border market. Following the “very productive and positive” meeting, the prime minister told a gathering of local elders that the two sides had decided to move forward in trade, investment, information technology, agriculture and other sectors.
The two leaders also decided to exploit the potential for cooperation in power transmission.
Sharif told the gathering that on his suggestion, the Iranian president also assured to enhance cooperation in the solar energy sector.
The prime minister said that during the meeting, he also put forward suggestions regarding the China-Pakistan Economic Corridor and that the two sides would take measures for implementing decisions taken at the meeting. 
Regarding the inauguration of Mand-Pishin border market, the prime minister said the facility would enhance trade activity in the surrounding areas and would get an uplift as trade centers would be built there. Shehbaz also invited Raisi to visit Pakistan, which the Iranian president accepted.
Coming to the project of 100-megawatt Gabd-Bolan transmission line, the prime minister said the project faced an immense delay in the past but the incumbent government ensured its completion in the record time. 
The Iranian president also took keen interest in the project, he added. He said the matter related to the power tariff has also been settled amicably with the Iranian government.
“This is a great day for Pakistan-Iran friendship and will prove a milestone for the development of the two countries,” the Pakistani premier remarked.
The Mand-Pishin border market is expected to provide a thriving platform for increasing cross-border trade, fostering economic growth and opening up new avenues of opportunity for local businesses. The two leaders also planted a sapling along the border market as a gesture to stride forward in ties between the two countries.
“This is a great day for Pakistan-Iran friendship and will prove a milestone for the development of the two countries,” the prime minister said. 
In an exclusive interview with IRNA, Shehbaz stressed the importance of enhanced cooperation with Iran, terming energy projects and border markets “emblematic of the vitality of Pakistan-Iran friendship”. 
Shehbaz made the remarks in a written interview sent to IRNA’s bureau office in Islamabad. The premier was of the view that the Mand-Pishin border marketplace and the Polan-Gabd electricity project are “tangible manifestations” of this joint resolution.
He added that border markets, including Mand-Pishin, will not only ameliorate the socioeconomic conditions of our border regions but also foster new opportunities for local businesses. 
“They would also serve as a stepping stone for greater cooperation between our two countries, especially in the economic domain,” the premier said. 
Shedding light on trade, Shehbaz noted the tremendous scope and mutual desire for the actualization of bilateral trade potential. 
“Both Pakistan and Iran are deeply committed to achieving an annual trade volume of $5 billion. In this regard, the operationalization of the barter trade mechanism is a significant step,” he said.

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