ISLAMABAD: In a major breakthrough in trade relations, Pakistan and Afghanistan have signed a Preferential Trade Agreement (PTA) to reduce tariffs on each other’s imports, Commerce Ministry officials said here.
Afghanistan’s Deputy Minister for Commerce and Industry Mullah Ahmadullah Zahid and Pakistan’s Commerce Secretary Jawad Pal signed the agreement at a ceremony in Islamabad on Wednesday.
A PTA is a trade agreement between two or more countries where they agree to reduce or eliminate tariffs and other trade barriers on certain goods and services traded between them.
The two countries have agreed to reduce the tariff rate from 60 percent to 27 percent.
Commerce Ministry officials said the agreement will be approved by the federal cabinet. It will come into effect from August 1, 2025 and will remain effective for an initial period of one year.
The preferential agreement will be extendable by mutual consent, the officials said.
Under the agreement, Afghanistan will reduce tariffs on mangoes, quinoa, bananas and potatoes coming from Pakistan, and Pakistan will reduce duties on grapes, pomegranates, apples and tomatoes coming from Afghanistan.
The parties have also agreed to form a technical committee for the transit trade agreement between Pakistan and Afghanistan.
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