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Pakistan May Fail to Sign Deal with Russia dominated block- ECU Sajjad Azher

Official said that Pakistan was mainly depending on America and European Union Market and textile products were major items to export to these countries. Pakistan has been depending on these markets since long due to influence of US in Pakistan. However, after civil nuclear cooperation between Pakistan and India started creating rift between Pakistan and US and bilateral relations became worse after Pakistan and China started work on China-Pak Economic Corridor (CPEC). According to official, Pakistan has been facing blackmailing due to dependence on America and EU markets as U.S has been threatening to impose sanctions.

During the present regime of PML-N, Pakistani exports had fallen by US$ 4 billion which was a serious concern for Pakistan. According to official, Central Asian States had potential of trade but Pakistan had not encouraging figures of trade with this block. There were issues on border and corruption in Central Asian States and therefore, Pakistan could not make progress in trade. Former Prime Minister Nawaz Sharif was keen to enhance trade with Central Asian states. However, official said that it was good proposal to sign Free Trade Agreement (FTA) with Eurasia Economic Union which comprises Belarus, Kazakhstan, Russia, Armenia and Kyrgyzstan.

He said that except Armenia, former Prime Minister Nawaz Sharif had visited all other countries and they had assured to extend full support to sign FTA with this block. This block would also help exporters to pay one- time tax at border of member state and could move to any member country of this block. However, official said that Pakistan had concerns that US could block this move. Pakistan had major items of textile which were being exported to US and EU countries. Pakistan had also enjoyed GSP status in EU markets and officials were of the view that US and EU countries may offer some more incentives to keep Pakistan away from going into Eurasia Union block due to presence of Russia.

Belarus is a landlocked and one of the most industrialized countries located in the heart of the Europe and because of its significant geographic position Pakistan could achieve better access to the Eurasian and Eastern European markets through its free trade engagements with Belarus and the EEU.

The Organization fundamentally promotes the ideas of streamlining the flow and transportation of services and goods between the member states, therefore, it greatly attracts the interests of many stakeholders and according to the Russian Ministry of Economic Development, many international organizations and the economic giants like China has shown great interest in the creation of free trade zones through the EEU.

The present political and economic importance of the South and Central Asian region along with free trade and economic potential across the Eurasian region greatly appeals almost every regional and international country, whether may they be developed or developing nation seems eager to come in bilateral and multilateral engagements with these organizations and the states in the region.

The cooperation that is vital to the many states’ national interests consists of the fields of security, economic, energy, bilateral, free trade, scientific education and cultural interactions. Most particularly, the Russian Federation and China have leading ambitious roles in region’s economic and infrastructural developments.

In addition, the growing significance of the Shanghai Cooperation Organization (SCO) in the present scenario has further enabled China and Russia to become a dominant player on the global economic and political arena. This in turn has also provided small or developing nations to benefit from the mutual benefit efforts of the SCO, EEU and other forums for their industrialization and national economic development goals.

FTA with Eurasia Economic Union

He said that Pakistani former Prime Minister Nawaz Sharif had visited all countries including Belarus who were members of Eurasian Economic Union. He said that Russia was part of this union and prime Minister had directed to sign Free Trade Agreement (FTA) with this union to enhance bilateral trade with Russia and other member countries. He said that Pakistan wants to tap potential of trade with central Asian states and Russia. Therefore, Pakistani former prime minister had sought support of all members of Eurasian Custom Union where Pakistani traders could benefit by paying one time duty. He said that Commerce Ministry had moved a draft of FTA to Foreign office to share it with other countries but no response had been received so far.

All countries assure to sign FTA

Pakistani government is in trouble over dwindling exports and former Prime Minister Nawaz Sharif has directed commerce ministry to explore new markets of Central Asia.

The latest development on FTA with EEU

Official said that draft of FTA had been sent to foreign office to share with member countries of Eurasia Custom Union but no development had been made so far.Official said that one was political uncertainty in Pakistan following disqualification of former Prime Minister Nawaz Sharif.Since that time, there has been no major progress on this issue.He said that Prime Minister Shahid Khaqan Abbasi had visited Russia and stressed on enhancing bilateral trade. However, in Pakistan still there is political uncertainty and therefore working of the government had been marred. He said that government of Pakistan needs political will to deal with such issue and at present, ruling party PML-N is caught in political turmoil as their leader Nawaz Sharif is facing court cases and strong rift with military establishment.

A senior official of commerce ministry said that Russia and Pakistan were showing serious attitude during the last couple of years. He said that there had been frequent visits of Russian delegation to Pakistan. He said that during joint ministerial commission level meeting, Pakistani side was able to convince the Russian side to include the word market access for Pakistani products to Russia.

 Hurdle in FTA with Eurasian Custom Union

Official said that there was a major hurdle in moving on FTA with this union. He said that there was one country Armenia in this block with whom Pakistan had no diplomatic relations. He further said that Pakistan could not sign FTA with any block which any member states had no diplomatic relations with Pakistan. He said that therefore, Pakistan had not been able so far to sign FTA or any other agreement with Custom Union due to presence of Armenia in this block.

Conflict between Azerbaijan and Armenia

Official said that Pakistan wanted to have diplomatic relations with Armenia. He said that Azerbaijan and Armenia had such diplomatic relations which Pakistan and India have. They have major disputes and Azerbaijan did not want Pakistan to have diplomatic relations with Armenia. He said that Pakistan and Azerbaijan were recently moving fast on diplomatic and economic relations and among central Asian States; Azerbaijan was growing influence in Pakistan. He said that with its growing influence in Pakistan, Azerbaijan was lobbying in Pakistani circles not to have diplomatic relations with Armenia. Officials said that if Pakistan is able to have diplomatic relations with Armenia in future, then Pakistan would be able to sign FTA with Custom Union. He said that it would be a major political decision to have diplomatic relations with Armenia.

FTA with Russia

Official said that commerce ministry had been directed to work on signing FTA with Russia. However, Russia was a member of Custom Union and its directorate was in Moscow. He said that Pakistan would have to sign member of custom union to sign FTA with Russia. He said that Pakistan could not sign preferential treaty or FTA with Russia at this stage. However, he said that Pakistani side had included market access during meeting with Russian side and now Pakistan was exporting potato and some other items. He said that Russia was a big market and Pakistan could export any item which it was exporting to world market.

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