Pakistan is a signatory to Free Trade Agreements with China, Sri Lanka and Malaysia and Preferential Trade Agreements with Iran, Indonesia and Mauritius. The Minister for Commerce, Engr. Khurram Dastgir Khan after chairing a high-level meeting in the Ministry of Commerce has decided to begin a thorough review of all the trade pacts through which Pakistan conducts its trade on preferable terms with other countries on a bilateral basis.

The review will be conducted through multiple means of stake-holders' consultations and the analyses of trade data available. This will help provide clear guidelines to policymakers on which the country will negotiate further trade agreements.

Presently, Pakistan is in the process of negotiating Free Trade Agreements (FTAs) with Thailand, Turkey, South Korea and Iran which will broaden the trading opportunities for Pakistani businessmen.

The meeting noted that Pakistan's trading partners have negotiated bilateral and multilateral trade pacts with other countries thus securing greater market access. It also observed that the demand for enhanced market access should arise from domestic industry.

The Minister said that trade agreements compel the local industries to modernize and diversify in order to compete in the international market besides providing better choice of products to the local people.

Pakistani industries should also expand and remodel themselves according to the international standards, he added. There was an impression that Pakistan had poorly negotiated three out of a total of four Free Trade Agreements (FTAs) as imports from China, Malaysia and Sri Lanka are rising faster than exports. The Commerce Minister is himself of the view that the FTAs were not properly negotiated by the Commerce Ministry.

Commerce Minister himself played a role in convincing the Turkish leadership to sign an FTA with Pakistan. Turkey had imposed extraordinary duty on Pakistani textile products due to which Pakistan's exports nose-dived from $900 million to $400 million and efforts made by Islamabad to bring exports to the level of 2011 remained fruitless. Giving details, the sources said though Pakistan's exports to China increased from a few million dollars to $2.5 billion - with yarn the highest export earner - yet Chinese imports soared to $8 billion. However, bilateral trade figures quoted by China are far different from those cited by Islamabad.

Officials in Commerce Ministry claim that Pakistan is facing a revenue loss of Rs 22 billion per annum due to a trade imbalance, adding that Islamabad could not reap the benefits of Margin of Preferences after China signed FTAs with other countries, especially the ASEAN. Pakistan has requested China to open services sector for Pakistan for deeper linkages and greater market access to each other's markets. Commerce Ministry is also considering speeding up engagements in services sector and de-linking services from the goods negotiations.

According to sources, Chinese investments in the Economic Corridor will be channelled through Pakistani banks. It is expected that current account deficit would be curtailed by 15-20 percent which would be an enormous achievement if an agreement is reached.

A Free Trade Agreement with Malaysia has also failed to provide a level-playing field as trade balance remained in favour of Malaysia from day one. Pak-Malaysia trade volume which was around $1.007 billion reached $2.66 billion a couple of years ago.