MARKET DEVELOPMENT
Pakistan Wants RI To Resolve Obstacles on PTA Implementation
Pakistan Wants RI To Resolve Obstacles on PTA Implementation
05/04/2013 (Jakarta Post) - Pakistan wants Indonesia to resolve problems blocking implementation of a preferential trade agreement (PTA) that was scheduled to come into force in January, an envoy has said.
Pakistani Ambassador to Indonesia Sanaullah said on Thursday that Indonesia should accelerate signing an essential mutual recognition agreement (MRA) with Pakistan and remove non-tariff barriers on fruit imports, including monthly quotas, a complex licensing system and limited import entry points.
“These measures counter the best intentions and the spirit of the PTA,” Sanaullah told The Jakarta Post in an email interview. “Regretfully, Pakistan find itself victim. Our exports of citrus, which do not cause any harm to domestic [Indonesian] products, face additional costs.”
The agreement has been delayed on discrepancies on some tariffs as Indonesia adopted a harmonized system of codes.
However, the problem was reportedly resolved at the end of last month.
Pakistan vowed to immediately implement the PTA once it received formal assurances that barriers hindering imports of Pakistan’s kinnow citrus fruit were lifted, Sanaullah said.
Indonesia and Pakistan agreed on the terms for a PTA in September 2011 after a long series of negotiations, signing the deal in February 2013.
Bilateral trade between Indonesia and Pakistan has grown to US$1.65 billion in 2012, up 15.61 percent from $994.28 million in 2008.
In 2012, Indonesia exported $1.38 billion worth of goods and commodities to Pakistan, while importing $273.22 million.
The deal would cut Pakistan’s import duties on 216 tariff lines, including fresh fruit, cotton yarn and fabrics, ready-to-wear garments, fans, sporting goods and leather products.
On the other hand, Pakistan will trim its rates on 287 Indonesian products, such as cocoa products, rubber products, wood products, sugar confectioneries, chemicals, household products and electronics.
On top of that, the deal would significantly reduce Pakistani import duties for Indonesia on palm oil, of which Indonesia is the world’s biggest producer, and Indonesian import duties on kinnow oranges, of which Pakistan is the largest producer worldwide.
Pakistan currently levies tariffs on Indonesian palm oil that are 15 percent higher than those imposed on palm oil from Malaysia, which already inked a similar agreement in 2007.
This has led to a sharp drop in local palm oil exports to Pakistan.
Similarly, Indonesia has imposed a 25 percent duty on kinnow oranges from Pakistan since 2005, resulting in a significant slide in its export to the domestic market.
From 2008 and 2009, there were negligible exports of kinnow to Indonesia, which up to 2004 was still Pakistan’s biggest destination for the fruit.
Meanwhile, the Agriculture Ministry’s Quarantine Agency chief Banun Sri Harpini said that the agency had yet to receive a request from Pakistan to assess the health status of kinnow oranges that would allow it to conduct a risk analysis as part of the MRA.
“Once we carry out the risk analysis, we can then discuss which Indonesian commodities can get reciprocal and mutual recognition from Pakistan,” she told the Post in a text message.
Pakistani Ambassador to Indonesia Sanaullah said on Thursday that Indonesia should accelerate signing an essential mutual recognition agreement (MRA) with Pakistan and remove non-tariff barriers on fruit imports, including monthly quotas, a complex licensing system and limited import entry points.
“These measures counter the best intentions and the spirit of the PTA,” Sanaullah told The Jakarta Post in an email interview. “Regretfully, Pakistan find itself victim. Our exports of citrus, which do not cause any harm to domestic [Indonesian] products, face additional costs.”
The agreement has been delayed on discrepancies on some tariffs as Indonesia adopted a harmonized system of codes.
However, the problem was reportedly resolved at the end of last month.
Pakistan vowed to immediately implement the PTA once it received formal assurances that barriers hindering imports of Pakistan’s kinnow citrus fruit were lifted, Sanaullah said.
Indonesia and Pakistan agreed on the terms for a PTA in September 2011 after a long series of negotiations, signing the deal in February 2013.
Bilateral trade between Indonesia and Pakistan has grown to US$1.65 billion in 2012, up 15.61 percent from $994.28 million in 2008.
In 2012, Indonesia exported $1.38 billion worth of goods and commodities to Pakistan, while importing $273.22 million.
The deal would cut Pakistan’s import duties on 216 tariff lines, including fresh fruit, cotton yarn and fabrics, ready-to-wear garments, fans, sporting goods and leather products.
On the other hand, Pakistan will trim its rates on 287 Indonesian products, such as cocoa products, rubber products, wood products, sugar confectioneries, chemicals, household products and electronics.
On top of that, the deal would significantly reduce Pakistani import duties for Indonesia on palm oil, of which Indonesia is the world’s biggest producer, and Indonesian import duties on kinnow oranges, of which Pakistan is the largest producer worldwide.
Pakistan currently levies tariffs on Indonesian palm oil that are 15 percent higher than those imposed on palm oil from Malaysia, which already inked a similar agreement in 2007.
This has led to a sharp drop in local palm oil exports to Pakistan.
Similarly, Indonesia has imposed a 25 percent duty on kinnow oranges from Pakistan since 2005, resulting in a significant slide in its export to the domestic market.
From 2008 and 2009, there were negligible exports of kinnow to Indonesia, which up to 2004 was still Pakistan’s biggest destination for the fruit.
Meanwhile, the Agriculture Ministry’s Quarantine Agency chief Banun Sri Harpini said that the agency had yet to receive a request from Pakistan to assess the health status of kinnow oranges that would allow it to conduct a risk analysis as part of the MRA.
“Once we carry out the risk analysis, we can then discuss which Indonesian commodities can get reciprocal and mutual recognition from Pakistan,” she told the Post in a text message.