Japan has agreed to resume Pakistan's about $ 500
million annual assistance under the yen loan package and Official
Development Assistance from March this year. This was stated by Mr.
Nishiyanar, Director Trade Japanese Ministry of Commerce while briefing
newsmen on the separate meetings of visiting Japanese Minister for
Economy & Trade Industry, Shoicho Nakagawa, with President Pervez
Musharraf and Prime Minister Shaukat Aziz and Commerce Minister Mr.
Humayun Akhtar Khan's visit to Islamabad last week.
Answering a question, he said the amount of yen loan
was nearly $ 500 million at the time of suspension and forthcoming
amount depends on the selection of projects. He said the issue of PTA
was raised by Pakistani authorities, but the Japanese minister explained
that his country would like to change the mode of bilateral economic
President Pervez Musharraf, during the meeting, urged
that both the countries should explore new avenues to enhance bilateral
trade. He also added that Japan should take into account geographical
proximately for enhancing trade with Pakistan.
Prime Minister Shaukat Aziz appreciated the Japanese
role in helping tsumani victims and said Pakistan would like to purchase
Japanese early warning system. The Prime Minister also briefed the
Japanese Minister on domestic economic performance.
Nakagawa, in his meeting with Commerce Minister
Humann Akhtar Khan, said that any technical impediments in improving
bilateral relations would be removed and Japan could provide technical
assistance especially for Small and Medium Enterprises (SMEs), which
were the backbone of industrial development.
He observed that human resources in Pakistan have the
capacity to develop latest skills as Pakistan was producing surgical
instruments and sector balls of high quality and there was a need to
provide managerial and technical skills for further development of these
The Commerce Minister said that a joint study group (JSG)
should be established to work for bilateral market access initiatives in
the manner of the ongoing efforts of Pakistan with the US, China,
Singapore, etc. The Japanese minister noted the proposal and consented
to work on it further to develop a strategy after discussing it with
stakeholders in Japan. The visit was in sequence of the dialogue
initiated on bilateral economic cooperation during the visit of
President Musharraf in March, 2002. Two rounds of talks were held in
September 2003 and February 2004 in Tokyo and Islamabad, respectively.
The visiting minister informed that the resumption of
yen loan to Pakistan was being considered and processed in Japan and a
positive outcome was expected in the month of March 2005 when a
delegation of Japanese businessmen, accompanied by senior officials of
Ministry of Economy, Trade and Industry (METI) would also visit
Pakistan, which would further help strengthen the bilateral economic and
commercial relations, Japanese Minister observed that the human
resources in Pakistan had the capacity and it was producing surgical
equipments and soccer balls of high quality. There was a need to provide
managerial and technical skills for further development in these
sectors, he added.
Humanyn Akhtar briefly explained the present scenario
of economic development and the government policy on export-led growth.
He underscored the need for better market access for Pakistani exports
in Japan and to increase bilateral trade upto its potential Mr. Khan
proposed to establish a Joint Study Group to work for bilateral market
access initiatives in the manner of the ongoing efforts of Pakistan with
US, China, Singapore, etc. The Japanese Minister consented to work on it
further to develop the strategy after discussing it with the
stakeholders in Japan.
Japan had suspended Pakistan's assistance following
nuclear explosion in May 1998. The resumption of the loan package and
the ODA grant has been decided by the Japanese Government due to
Pakistan's commitment to peace, fight against terrorism and modification
of various regulations for opening up its various sectors for foreign
investment. It will mark an end to the economic sanctions that Tokyo had
imposed against Islamabad as a result of its nuclear tests.
Japan has been Pakistan's major trade and economic
partner. Its decision manifests recognition of Pakistan's prudent
financial policies and improvement in its economy as well as its
potential to pursue macroeconomic agenda. It's hoped that the
presumption of the Yen Loan Package and ODA will revive the traditional
economic relationship between the two countries and Pakistan will be
able to learn from Japan's phenomenal economic progress.
The fact is that Pakistan has ample potentials for
economic growth of eight percent in a couple of years and the resumption
of Japanese aid will contribute towards realization of its goal. The
visiting Japanese Minister had fruitful meetings with President
Musharraf and Prime Minister Shaukat Aziz. The President focused on the
attractive investment climate exists in Pakistan and invited Japanese
entrepreneurs to come forward and take advantage of the incentives
available here. Pakistan affords a level playing field both to the
domestic and foreign investors. Mr. Shoichi Nakagawa discussed measures
to enhance economic relations and bilateral trade between the two
countries during his meeting with Prime Minister Shaukat Aziz. It has
been decided that a delegation of Japanese businessmen accompanied by
senior officials of the Japanese Ministry of Trade and Industry will
visit Pakistan in March next to further help strengthen the bilateral
economic and commercial relations between the two countries. What
Pakistan needs is greater market access for Pakistani products in Japan
and to increase bilateral trade up to its potentials. That will, of
course, boost Pakistan's exports and will help her face the challenges
that WTO is posing to the developing countries.