KARACHI - Ambassador of Islamic Republic of Iran Mehdi Honardoost has said that lack of information and know-how about the capabilities of Iran and Pakistan amongst the business communities of the two neighboring Islamic countries was hindering trade but the situation has been improving as Pakistan-Iran trade volume improved by 31 percent last year.

“Business communities of both countries are totally unaware of each other’s capabilities and opportunities therefore, we have to focus on exchanging information, trade delegations and other promotional activities between the two countries, besides improving ties of Karachi Chamber with its peer Chamber in Iran”, he added while speaking at a meeting during his visit to the Karachi Chamber of Commerce and Industry.

Iranian Consul General in Karachi Ahmad Mohammadi, President KCCI Muffasar Atta Malik, senior office bearers and KCCI Managing Committee members attended the meeting.

Iranian Ambassador said that both countries have so many commonalities and similarities which simply cannot be found between any other countries of the entire region. He stated that there was a huge potential of cooperation between the two powers of the region with good neighborly ties and whole history of friendship and fraternity.

He was of the view that the regional problems like terrorism, human trafficking and narcotics trafficking should be solved by the regional countries, which have common perception, common interests and common concerns.

Mehdi Honardoost said that Iran was keen to develop its ties with Pakistan by focusing on enhancing trade which continues to grow each year, exporting electricity to Pakistan, implementing Iran-Pakistan gas pipeline, signing of Free Trade Agreement and commencement of banking transactions between the two brotherly countries. “Your rivals are much faster and active than you so you also have to take steps accordingly. You have to grab some more portion of the Iranian market which has a lot of potential for Pakistani goods and services. We are also ready to share almost everything with our Pakistani brothers and sisters”, he added.

He said that Iran was particularly interested in some of the giant projects with Pakistan including the IP gas pipeline project, signing of FTA, and commencement of banking operations between the two countries. “IP gas pipeline project can completely change the face of Pakistan’s economy as the cheaper gas being supplied under this project can be used as raw material by industries which would create a lot of job opportunities whereas it can also be used for cheaper power generation”, he said, adding that delays in FTA and commencement of banking transactions are impediments to enhanced trade and businesses between the two countries.

Honardoost opined that China-Pakistan Economic Project (CPEC) was a multi-functional project which can bring peace and prosperity in the region as all countries of this region will become part of this project.

Speaking on the occasion, President KCCI Muffasar Atta Malik informed the Iranian Ambassador that Karachi, which is the economic hub of Pakistan, offers profitable opportunities and added facilities for investment and joint ventures to investors from Iran.

He said that negotiations on FTA between Pakistan and Iran are underway as both countries have expressed their willingness to upgrade Preferential Trade Agreement (PTA) into Free Trade Agreement (FTA) for which initial drafts have already been shared. With Iran agreeing on the initial draft sent by Pakistan, both countries have decided to enhance bilateral trade to up to $5 billion through the FTA which currently stands at around $150 million.

Muffasar Malik noted that in order to facilitate trade with Iran, State Bank of Pakistan (SBP) has also shared draft of memorandum of understanding (MoU) for signing its Banking Paying Arrangement (BPA) with Iranian Bank Markazi Jomhouri. Furthermore, Pak-Iran currency swap agreement is another important option for enhancing bilateral trade. In this regard, both countries have already signed MoU through which channels would be opened in the central banks of both countries for trade transactions that would reduce the usage of dollar account for Letter of Credit (LC) clearance.