Pakistan, Iran Forge $8 Billion Trade Pact
Leaders Aim to Leverage Geography for Economic Surge
Pakistan and Iran have officially committed to boosting their annual bilateral trade to $8 billion, recognizing the strategic advantage of their shared geography and the inherent cost savings it offers.
Deepening Economic Ties
The landmark agreement was solidified during discussions between Pakistan’s Commerce Minister, Jam Kamal Khan, and Iran’s Minister for Industry, Mines, and Trade, Mohammad Atabak. Their meeting occurred on the sidelines of Iranian President Masoud Pezeshkian‘s recent state visit to Pakistan.
Both ministers emphasized a renewed dedication to accelerating trade, addressing border hindrances, and cultivating partnerships based on trust across key sectors.
“We’ve done this model successfully in Belarus and elsewhere. Let’s do the same for Iran, starting with sectors that show the greatest potential for mutual benefit.”
—Jam Kamal Khan, Commerce Minister of Pakistan
Jam Kamal Khan highlighted the significant potential, stating that optimized trade could readily surpass $5 to $8 billion annually in the coming years. This ambition echoes President Pezeshkian‘s earlier remarks about increasing bilateral trade volume to $10 billion.
Leveraging the ‘Discount of Distance’
The ministers underscored the importance of maximizing neighborhood trade opportunities. Khan drew a parallel to the substantial benefits observed among ASEAN nations trading within their region.
“Geography is an advantage. Pakistan and Iran must utilize this discount of distance. If we don’t, we lose both time and cost benefits,” Khan stated, advocating for targeted trade delegations involving chambers of commerce to facilitate market access and regulatory processes.
The push for increased economic integration is part of a broader strategy to enhance regional connectivity. Trade between Pakistan and its neighbors has been growing; in 2023, Pakistan’s total trade with Central Asian countries reached approximately $1.7 billion, demonstrating the potential for expanded partnerships (source: Ministry of Commerce, Pakistan).
Strengthening Connectivity and Collaboration
Both nations are committed to optimizing existing trade corridors and border crossing points. Mohammad Atabak also noted Iran’s interest in boosting exports to Pakistan and urged prompt follow-up on recently signed agreements.
“Traders and industrialists in both countries are ready. They trust each other. What they need now is a clear and consistent facilitation mechanism from our side,” Atabak remarked, signaling Iran’s readiness to actively support the trade initiative.
Beyond bilateral gains, Khan proposed that this enhanced connectivity could extend to Turkey, Central Asia, Russia, and West Asia, potentially forging a robust economic bloc.
B2B Engagement and Sectoral Focus
Atabak expressed strong support for instituting dedicated business-to-business (B2B) days during all high-level visits and committed to bringing Iranian business delegations to Pakistan for focused engagement.
Both ministers agreed on prioritizing key sectors for future collaboration, including agriculture, livestock, services, energy, and cross-border logistics. This strategic alignment signals a new era of economic partnership aimed at reshaping regional trade dynamics.