Pakistan, Indonesia to resume talks on PTA

 To conclude the agreement, seven rounds of negotiations were held but the talks had been deadlocked over granting concessions on various products of export interest. The last round was held here in June 2011. Dawn
In August 2003, both countries held the first round of meeting in Islamabad on PTA) but failed to conclude it over differences on reduction in duties on palm oil and kinno (oranges).A senior official in the commerce ministry told on Friday that the next meeting has been scheduled for September 15-16 in Jakarta to take up again the issue of scaling down duties on various products.
Until the fourth round, Pakistan had agreed to grant duty concessions on 280 tariff lines, while Indonesia reciprocated by allowing concessions on 180 tariff lines. However, both sides were not satisfied with the duty concessions and exchanged fresh lists of items for further concessions.
Pakistan has handed over a list of 43 items for bringing down its tariff to five per cent. These items were already agreed by Indonesia for duty reduction but Pakistan was demanding further deeper cuts.
Aside from this, a new list of 32 products was also presented to Indonesian authorities for consideration as part of all those produces which was agreed earlier.
To reciprocate Pakistan`s demand Indonesia also handed over a list of 30 items to Islamabad for consideration.
The official said the talks were mostly deadlocked over disagreement on the scale of tariff reductions on palm oil, sorbitol, ceramics and paper. Pakistan is reluctant to grant concessions in duties mostly on these products.
But Indonesian authorities were pushing for duty reduction on palm oil and papers, especially to grab market access.
As a result of Pakistan`s free trade agreement (FTA) with Malaysia, Indonesian exports of palm oil to this country dropped. The pact enables Kuala Lumpur to enjoy 10 per cent less duty on palm oil than Indonesia.
Pakistan requested tariff reductions for kinnos along with several agricultural products and textiles.
The official said that some understanding has been reached on palm oil duty reduction but Islamabad is unwilling to give concessions on paper, ceramics etc.
Currently, Indonesian exporters are exporting palm oil to Pakistan via Malaysia but still it did not help them to reduce their costs of exports.
The trade-off on lowering of tariffs will mostly benefit Indonesia, which has enjoyed a huge trade surplus with Pakistan.

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