Govt mulls trade bloc with Iran, Oman

Plan under study to connect Gwadar with ports of Iran and Oman to make it re-export hub

ISLAMABAD:

A plan is under study to form a bloc comprising Pakistan, Iran and Oman to ramp up regional trade and give a boost to trade activities at Gwadar Port.

"In future geopolitical policymaking, Pakistan, Iran and Oman are going to emerge as key players in the entire region," an official said, adding that discussions were continuing in official circles.

The bloc may be established after the US-Iran war comes to an end as Pakistan hopes that the US will lift sanctions – a key demand of Iran.

Pakistan has gained recognition as a peaceful country during the US-Iran conflict because it did not take sides. Also, Iran opened all trade routes for Pakistan for the first time and even the Pakistan-Iran transit corridor started functioning – termed a major success for Islamabad.

Pakistan has traditionally used the Afghan route for trade with Central Asian states. The former Afghan government had been influenced by Indian politics and it even threatened repeatedly to block the route.

The Afghan Taliban – the current rulers – have closed the trade route for Pakistani exporters aspiring to reach Central Asia following tussle over Tehreek-e-Taliban Pakistan (TTP) activities.

During the war, Pakistan has found another trade route via Iran to access the Central Asian states, officials said, adding that it would help to make Gwadar Port fully operational.

Sources told The Express Tribune that Pakistan's government was hopeful that the Middle East war would end soon permanently. Iranian foreign minister is on a visit to Pakistan and he will also go to Oman and Russia for a durable ceasefire.

According to experts, the United Arab Emirates (UAE) had been an active player in geopolitics whereas Oman was neutral and a key player in diplomatic talks between the United States and Iran.

They were of the view that the Iranian foreign minister might visit Russia to discuss the uranium issue and may even ask Moscow to play the role of a guarantor in the US-Iran ceasefire talks.

The Middle East war has also exposed the UAE's role which engaged in a row with Pakistan. Afterwards, it asked for returning a $3.45 billion loan, which Pakistan successfully repaid.

Referring to the proposed Pakistan, Iran and Oman trade bloc, officials said that Pakistan wanted to connect Gwadar Port with the ports of Iran and Oman to make Gwadar a hub for the re-export of products like the Dubai Port.

Pakistani officials have recently announced that Gwadar Port had an export potential of $20 billion. "Iran has been using Dubai for years as an informal channel for trade, which amounted to $45 billion a year," an official said, adding that the entire trade volume would shift to Gwadar if the US lifted sanctions following a peace deal.

Saudi Arabia may also revive its investment plans when Gwadar Port becomes fully operational as it provides an alternative route to China for oil imports not only from Riyadh but also from Iran, officials said. During the previous Pakistan Tehreek-e-Insaf (PTI) government, Saudi Arabia had announced an investment of $20 billion but it could not materialise.