Indonesia confirms Pakistan trade agreement to protect palm oil exports
JAKARTA: The Indonesian government is geared up to confirm a trade deal with Pakistan in order to protect $1.5 billion in annual palm oil exports to the South Asia region, a cabinet minister stated.
According to Abdul Rasheed JanMohammed, chairman of Pakistan Edible Oil Refiners Association, Indonesia is termed as the world’s major palm oil producer, and considered as a leading exporter to Pakistan, but still it has been losing its market value to Malaysia, which is on the second number in the world.
Indonesia’s Coordinating Minister of Economic Affairs, Darmin Nasution declared in a statement on Wednesday that the preferential trade agreement (PTA) with Pakistan will be confirmed by the president, without any parliamentary authorization.
He also added, if Indonesia is unable to approve the deal immediately, “Pakistan will conclude the PTA, due to which Indonesia will lose its crude palm oil market of value almost $1.46 billion, which can be easily taken over by Malaysia then.”
Furthermore, it is projected that this year Pakistan will probably purchase 70% of its crude palm oil from Indonesia, which is comparatively less as of 80% in the precedent two years, as Malaysia has already taken market share of Pakistan.
According to data, in 2017, Indonesia reserved a $2.15 billion total additional trade with Pakistan, with a total two-way trade of $2.63 billion.
The sources revealed that, Indonesia is also prepared to confirm six additional deals that have been held up in parliament for a number of years without any clarification.
It is also expected that Indonesia will ink a detailed economic partnership contract with Australia before the conclusion of this year.