Discrepancy arises over Pakistan-GCC FTA: minister’s claims contradicted by BoI

In a surprising turn of events, a significant discrepancy has emerged surrounding the purported Pakistan-Gulf Cooperation Council Free Trade Agreement (Pak-GCC FTA). Caretaker Minister for Commerce and Industries, Gohar Ejaz, recently made bold claims about the finalization of the FTA, but these statements have been contradicted by reliable sources within the Board of Investment (BoI), as reported by Business Recorder.

During a press conference held on October 4, 2023, Gohar Ejaz announced that Pakistan had achieved a historic milestone in trade relations with the Gulf Cooperation Council by successfully concluding the FTA, which he stated marked the first FTA the GCC had entered into with any country in the past 14 years. However, sources within the BoI have since revealed a different reality.

Sources within the Board of Investment told BR, the claims made by the Commerce minister appear to be inaccurate. The FTA document has neither been finalized nor signed in Riyadh. Instead, both sides have only signed a one-page document titled “Initiation of  Signing of the Agreement on FTA,” which has been shared with the Government of Pakistan through diplomatic channels.

The BoI has highlighted a crucial obstacle to the FTA’s finalization, emphasizing that the Bilateral Investment Treaty (BIT) must be concluded before the FTA can proceed. It has been reported that GCC members, particularly Saudi Arabia and Qatar, are eager for the BIT to be finalized before making any significant investments in Pakistan.

Further complicating matters are the differences that have emerged during the BIT negotiations. Some articles within the negotiations do not align with Pakistan’s Model BIT template, which has already been approved by the federal cabinet. These differences need to be addressed and resolved before progress can be made.

The Embassy of Qatar in Islamabad, on its part, has been actively engaged in discussions with Pakistani authorities since January 2022. It has requested the expedited finalization of the FTA process and has sought a specific list of goods for consideration.

In response to the ongoing discrepancies, the BoI has proposed that relevant ministries and divisions share their comments on the BIT template to ensure Pakistan’s stance is firm before presenting the case to the federal cabinet.