Smuggling impedes trade between Pakistan, Iran.

Despite a preferential trade agreement (PTA) and memorandums of understanding (MoUs) inked between Pakistan and Iran, smuggling of goods between the two countries has been increasing due to high tariffs.

During a webinar organised by the Karachi Chamber of Commerce and Industry (KCCI), Chamber Vice President Shamsul Islam Khan suggested that Pakistan and Iran should look into the possibility of setting up a duty-free Common Trading Zone and an industrial park at the border to improve the existing meagre trade volume between the two countries and effectively curb smuggling, which was hampering legal trade.

Khan pointed out that other than the PTA between Pakistan and Iran, numerous MoUs had also been inked and a free trade agreement (FTA) was being negotiated.

'However, all these agreements and MoUs have not yielded positive results as the trade volume remains low while smuggling flourishes,' he lamented. 'Hence, it is essential to bring down tariffs and establish a duty-free common economic zone and industrial park where business communities of both countries could easily set up their business units and warehouses, which will surely give a boost to the two-way trade.'

Setting up of the common economic zone would prove to be the first step in documentation of the economy, he added. Khan emphasised that Pakistan and Iran, besides looking into the possibility of implementing a paper visa regime, must also agree on giving duty-free access to numerous products.

'We can start from five to 10 items having immense trade potential and after seeing the impact, the list can be enhanced by adding more...