JAKARTA: Pakistan has agreed to lower its duty by 15 percent on Indonesian crude palm oil and its by-products by January 2012, officials said.
In return, Indonesia will open its market for Pakistan's Kino oranges with zero import duties, said Indonesian Deputy Trade Minister Mahendra Siregar.
The preferential trade agreement (PTA) was sealed late Friday with Pakistan Secretary of Commerce Zafar Mahmood in Jakarta, pending approval from respective parliaments.
The two countries had been discussing the proposed PTA for several years.
The deal is expected to raise Indonesian palm oil exports market share in Pakistan and compete on the same level with rival Malaysia that has received lower duties since 2007. Currently, Pakistan applies 9,500 to 10,800 Pakistani rupees per tonne on Indonesian palm oil products.
According to Mahmood, Indonesian palm oil market share in Pakistan dropped to 5 percent from 55 percent earlier after Malaysian received lower duties four years ago.
"We think that it will regain to its original share," Mahmood said.
Indonesia and Malaysia account for 80 percent of the total global supply of palm oil. (Reuters)
The preferential trade agreement (PTA) was sealed late Friday with Pakistan Secretary of Commerce Zafar Mahmood in Jakarta, pending approval from respective parliaments.
The two countries had been discussing the proposed PTA for several years.
The deal is expected to raise Indonesian palm oil exports market share in Pakistan and compete on the same level with rival Malaysia that has received lower duties since 2007. Currently, Pakistan applies 9,500 to 10,800 Pakistani rupees per tonne on Indonesian palm oil products.
According to Mahmood, Indonesian palm oil market share in Pakistan dropped to 5 percent from 55 percent earlier after Malaysian received lower duties four years ago.
"We think that it will regain to its original share," Mahmood said.
Indonesia and Malaysia account for 80 percent of the total global supply of palm oil. (Reuters)
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