Pakistan GCC Free Trade Agreement: A great success for Pakistan II

Pakistan and GCC concluded the final round of negotiation on the Pakistan- GCC FTA (Free Trade Agreement) at Riyadh, Saudi Arabia. The final round was held from September,26-28,2023 at the GCC headquarter, Riyadh. This is a significant development as the FTA is the first by GCC with any country since 2009 and marks a milestone in both sides’ economic cooperation.
The agreement was signed by GCC Secretary General Jasem al-Budaiwi and Pakistan minister for Commerce and Industry, Dr. Gohar Ejaz. According to Al Badaiwi the preliminary free trade agreement (FTA) between the GCC and Pakistan comes in recognition of the importance of strengthening trade relations and economic cooperation with countries and international blocs. The commerce Minister said that FTA will ensure that economic ties are commensurate with these relations. Pakistan and GCC delegation recently negotiated in Islamabad, where general consensus was evolved that FTA must be signed even and further negotiation will continue to decides which items to be included at 100% free of tariffs. Pakistan and UAE are also in process of negotiation on a trade pact.
Pakistan’s Trade with GCC countries

Country Exports
Us$ million Imports US$ million Trade volume US$ million Balance of Trade US$ million Pakistan’s total export US$ billion % in Pak total export Pakistan’s Total Imports $ bn % in total import
Bahrain 94.16 68.81 162.97 25.36 28.88 0.2 73.11 0.1
Kuwait 172.69 1407.72 1580.41 -1235 28.88 0.7 73.11 2
Saudi Arabia 403.1 3738.9 4142 -3335.9 28.88 1.4 73.11 5.2
Oman 196.5 451.3 627.8 -274.8 28.88 0.6 73.11 0.6
Qatar 406.2 2672.4 3078.6 -2266.2 28.88 1.4 73.11 3.7
UAE 1163 7338.5 8499.8 -6177.1 28.88 4 73.11 10.00
Total 2,416 15,678 18,092 -13,264

Pakistan’s total export are US$ 2.416 billion and imports are US$ 15.678 billion and balance of trade U$ - 13.264. Pakistan needs to try its best to enhance its export to GCC countries. There is very good potential of Pakistani Textile, Garments, leather goods, fruits, sports goods, surgical instruments, cement, marble etc. CPEC can provide access to Central Asian countries to Gulf and Gulf countries to central countries. To remove language barrier industrialists, need to hire SCHOLARS FROM JAMIA BINORIA ALAMIA to translate documents into Arabic language and to get more effective access to Gulf Markets.
Gulf Countries exports Major partners
S.No County Exports US$ billion Share in Total exports US$ billion % share
1 China 48.81 10.53
2 India 38.35 8.27
3 Japan 26.97 5.82
4 South Korea 15.77
3.46
5 Saudi Arabia 13.11 2.83
6 Singapore 12.92 2.79
7 Switzerland 10.98 2.37
8 Thailand 8.72 1.88
9 Turkiye 8.70 1.88

GCC Countries Trade Balance
2020-21
Country Trade balance US$ billion
Saudi Arabia 45.18
Qatar 25.67
Oman 14.23
Kuait 12.41
Bahrain -0.49
UAE -13.49

GCC Major Import Partners 2020-21
S.No Country Imports US$ billion % of total
1 China 71.81 18.90
2 USA 37.31 9.82
3 India 29.79 7.84
4 Germany 19.01 5.00
5 Japan 15.61 4.11
6 UK 12.40 3.26
7 Italy 11.72 3.09
8 UAE 11.32 2.98
9 France 9.59 2.52
10 South Korea 9.28 2.44
The GCC is currently in the process of negotiating trade agreements with other countries and trade blocs including the European Union (EU), China, Turkiye, Japan, South Korea, Australia and New Zealand. The European Free Trade Association (EFTA) states which include Norway, Iceland, Switzerland signed a Free Trade Agreement with the Gulf Cooperation Council in Hamar, Norway on June 22, 2009. The agreement came into force on first July,2014.
Pakistan needs to take advantage of GCC free trade agreements and invest in countries like Qatar, Saudi Arabia, UAE and Oman to re- export its products to EU, Singapore and other countries.