ISLAMABAD, July 8: Germany has ratified the new Bilateral Investment Treaty (BIT) with Pakistan after obtaining consent of its parliament, according to a message received here on Friday.

The entry into force of new Bilateral Investment Treaty will boost economic cooperation with Germany, and guarantees favourable conditions for German companies to invest in Pakistan. It will also strengthen cooperation between corporate sectors of the two countries.

After ratification by Germany, the new Bilateral Investment Treaty has replaced the old agreement for protection of investment, which the two countries had signed in 1959. Pakistan had ratified the new treaty in 2010.

The modern version of Bilateral Investment Treaty was signed on Dec 1, 2009, in Berlin during the visit of Prime Minister Yousuf Raza Gilani, says a press release received here on Friday from Berlin.

Germany is an important source of Foreign Direct Investment (FDI) in Pakistan. Many German companies are doing business in Pakistan, and statistics showed that during fiscal year 2009-10, Germany was the fifth largest source of FDI in Pakistan.