Pakistan parley

External Affairs Minister outlines extensive trade plans; barter process mooted with US$ 200 m credit facility; Pak state bank to open branch; PIA to resume flights in March and Joint Economic Commission to meet for private sector investment

By Uditha Jayasinghe



Returning to barter business Pakistan and Sri Lanka are discussing the possibility of commodity exchange through a US$ 200 million credit facility as a measure of heightening bi-lateral relations, the Pakistani Foreign Affairs Minister said yesterday.

Foreign Minister Shah Mehmood Qureshi told a media gathering ahead of the business forum that the Pakistani president was to address the plans that had been discussed between the two presidents when they met on Sunday evening. After a series of discussions between ministers, parliament speaker and investment officials various means of cooperation between the two countries were determined upon.

“The barter system was discussed because both Pakistan and Sri Lanka are countries that need foreign exchange and are wary of is flowing out of their respective countries,” he explained adding that under the barter system this would not be necessary as goods would be exchanged instead of transaction using money. The US$ 200 million credit facility would aid this venture with products of Pakistani origin taking a prominent place.

The bi-lateral investment treaty would be used along with the Free Trade Agreement (FTA) that became effective between the two countries in 2005. The National Bank of Pakistan will also open a branch in Sri Lanka to facilitate trade through financial services while Pakistan International Airlines (PIA) will resume flights to Sri Lanka from March 2011.  

“Tea, cement and betel leaves are among the products that had come under discussion,” he said pointing out that there were many synergies between the two economies that could be expanded further.

Land in the economic processing zones of the two countries could be exchanged as well under the new agreement, according to the external affairs minister.  However he declined to comment on whether Pakistan has plans to fund Sri Lanka’s massive infrastructure projects, in similar fashion to India.  

“Pakistan is very good at setting up processing plants. So Sri Lanka can take advantage of this fact and establish sugar and cement factories in Sri Lanka through our help.”  It had been agreed that the Joint Economic Commission (JEC) between the two countries would meet at a mutually convenient date to discuss investment from the private sector.

Several Memorandums of Understanding (MoU) were signed between the two countries during the last few days including those pertaining to arts and crafts, diplomatic visas and Pakistani and Sri Lankan chambers of commerce.    

Pakistan is also considering using Lankan expertise to develop its tourism and counter terrorism functions. 

Pakistan offers Sri Lanka specialised police training in counter-terrorism       

(APP) -Pakistan on Monday offered specialised training, closer collaboration and sharing of expertise in counter-terrorism to help Sri Lanka better train its security forces to thwart any future terrorist threat.“We wish to strengthen our cooperation in ridding our countries of this menace and we can do it by learning from experiences of each other,” Foreign Minister Shah Mahmood Qureshi told reporters at a press conference. Both Pakistan and Sri Lanka have had extensive experience in fighting terrorism, both at the hands of home grown and foreign trained groups that have killed thousands and caused damages of billions of dollars, prompting both sides to raise special forces to counter the threat.

Foreign Minister Qureshi, who is part of President Asif Ali Zardari’s delegation on a four-day visit to Sri Lanka, said the two countries have had close cooperation in training of defence personnel in the past.

He said Pakistan had trained thousands of policemen to deal with terrorists effectively and had improved the techniques with experience, which were being used to successfully thwart terrorist attempts.

Pakistan over the years had raised special elite units of police trained by local and international counter-terrorism experts and the Special Services Group of the Pakistan Army.

These units were trained in guerrilla warfare, bomb disposal and modern investigative techniques to foil acts of terrorism.