The Indonesian government is aiming to finalize a preferential trade agreement (PTA) with Pakistan by the end of the year, a deal it anticipates will enable it to increase exports of crude palm oil (CPO).
Trade Minister Mari Elka Pangestu said Thursday the two governments had only few things left to negotiate.
"*The PTA* is almost ready. It will be completed by the end of this year," she said.
In a bid to speed up the completion of the deal, the ministry plans to lobby Pakistan through Pakistani Charge d'Affaires ad interim Mirza Salman Babar Beg.
Indonesian Trade Ministry director for bilateral cooperation Martua Sihombing said Friday he was planning to meet Babar Beg on Saturday to "persuade" Pakistan to complete the agreement "as soon as possible".
"I will talk to him tomorrow *Saturday*, to ask *the Pakistan government* to complete our negotiations," he said.
The Ministry's director general for international trade cooperation, Gusmardi Bustami, said, "There are only the tariffs on CPO and Kino still to be resolved," he said, referring to the two main issues in the PTA.
According to data from the Agriculture Ministry, Pakistan imposes import duties of Rp 9,100 a ton on CPO and its derivatives from Indonesia - the world's largest CPO producer - while it imposes 10 percent less duties on CPO from Malaysia because of a bilateral trade agreement between those two countries.
In Pakistan, Indonesia's CPO market share declined to 28 percent in 2008, from 50 percent in 2007.
The total bilateral trade between Indonesia and Pakistan has so far stood at around US$600 million, with Indonesia's CPO and CPO-based products contributing between $400 million and $450 million to that amount, Gusmardi said.
Meanwhile, Pakistan has also complained that Indonesia's higher tariffs had disrupted exports of oranges to Indonesia.
Gusmardi said Indonesia, which has imposed 25 percent import duties on Pakistani Kino oranges since 2005, would "harmonize" the tariff under the PTA, although the amount has yet to be agreed upon.
