On September 28, 2023, the Gulf Cooperation Council (GCC) initialised a preliminary free trade agreement (FTA) with Pakistan. Forged by years of a close relationship and a shared vision for regional prosperity, keeping the economic bond between the GCC and Pakistan in view, this is a landmark step forward towards a longer term expanded Pakistan-GCC Economic Partnership. Upon the completion of internal approvals by GCC member countries, the final agreement will come into effect. This FTA is designed to enhance market access for goods and services between GCC nations and Pakistan by eliminating or reducing customs duties on goods and services. This groundbreaking initiative promises to dismantle trade barriers, fostering a dynamic marketplace where investment flourishes, production thrives, and businesses across diverse sectors gain access to new markets. Additionally, it seeks to encourage and safeguard investments. The comprehensive provisions of the FTA encompass various aspects, including customs procedures, investment, e-commerce, dispute resolution, trade remedies, competition, intellectual property, and the promotion of small and medium enterprises. The agreement also has broader objectives, aiming to foster collaboration in areas such as energy, health, food security, agriculture, security, transportation, environment, culture, and education.[1]
Previously, a vision of free trade between Pakistan the GCC was discussed in 2004 with the signing of a preliminary framework agreement. Encompassing the six member nations of Saudi Arabia, the United Arab Emirates, Bahrain, Oman, Qatar, and Kuwait, this pact laid the groundwork for a potentially transformative economic partnership. However, early negotiations yielded limited progress, and the initiative was dormant for nearly two decades. In a welcome development, 2021 witnessed a revitalization of the dialogue, with the UAE and Pakistan revisiting the FTA’s potential with renewed rigour and determination.[2] This renewed momentum offers promising prospects for forging a robust economic partnership capable of unlocking significant opportunities for both Pakistan and the GCC, which is long overdue.
