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Pakistan Malaysia Free Trade Agreement

  • April 11, 2021

Malaysia`s trade with Pakistan increased by 11.1% to 5.56 billion.RM ($1.34 billion), from $5.01 billion.RM in 2015. A free trade agreement is an international agreement between two or more countries to reduce or remove trade barriers and achieve closer economic integration. The Malaysia Pakistan Free Trade Agreement (FTA) officially known as the Malaysia Pakistan Closer Economic Partnership Agreement (MPCEPA) came into force in 2008. The aim is to promote bilateral trade between the two countries through tariff preferences for different posts. The free trade agreement is one of the most comprehensive agreements signed by Pakistan, which includes trade in goods, services, investment and economic cooperation. The MPCEPA is a comprehensive agreement that also includes the liberalisation of trade in services. Pakistan has offered a maximum foreign participation of 60% in all sectors, and the number of Malaysians employed per organization does not exist. The sectors of interest to Malaysia are professional services, construction services and related engineering services, educational services and telecommunications services. This study, conducted at the SH-06 level, shows that Pakistan`s main potential trade item remains largely based on agriculture. A comparison between the Malaysia-India-China free trade agreement shows that they have lower tariffs overall than Pakistan`s, particularly on Pakistan`s export interest items. Sign in here to access free tools such as favorites and notifications, or to access personal subscriptions. The agreement is the first bilateral free trade agreement between two Muslim countries – members of the OIC.

The agreement is Pakistan`s first comprehensive free trade agreement, which includes trade in goods, trade in services, investment and economic cooperation, as well as Malaysia`s first bilateral free trade agreement with a South Asian country. This agreement is a timely initiative of the Pakistani government to secure the market for its export products in Malaysia and to deepen economic and trade relations with an important member of the region. The MPCEPA includes trade liberalization of goods and services, investment, bilateral technical cooperation and capacity building in areas such as plant health and protection, intellectual property protection, construction, tourism, health and telecommunications. For merchandise trade, Pakistan will eliminate tariffs on 43.2% of imports from Malaysia by 2012. On the other hand, Malaysia will eliminate tariffs on 78% of imports from Pakistan. With regard to trade in services, both countries have granted the WTO more market entry. In the field of IT and I-related services. T, Islamic Banking, Islamic Insurance (Takaful) Pakistan secured 100% equity in Malaysia. Access to the services market in both countries will have a positive impact on investment and trade in goods. The rules of mutual recognition are also alongside the free trade agreement. These rules will provide a framework for accreditation of educational institutions and university programs and facilitate the effective and effective provision of services. While acknowledging that agriculture is the backbone of Pakistan`s economy, the study recommends a long-term trade strategy to encourage the export of industrial products, contrary to the current strategy to boost agricultural raw material exports.

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