ISLAMABAD, March 28: The D-8 countries on Friday finalised the rules of origin for the implementation of the much-awaited preferential trade agreement (PTA) to increase the volume of regional trade.

The high-level trade officials of the bloc — Pakistan, Bangladesh, Egypt, Nigeria, Malaysia, Turkey, Iran and Indonesia — had signed the PTA in Bali in May 2006, which was delayed due to failure of the block in finalizing the rules for its implementation.

A senior official in the commerce ministry said that the rules were finalized in a two-day meeting of the technical experts of the member countries headed by Secretary General D-8 Dipo Alam.

Head of Pakistan trade delegation Senior Joint Secretary Commerce Ministry Shahid Bashir told Dawn that six out of eight countries have agreed on 40 percent margin of value addition in goods for export purposes. However, he said Egypt and Bangladesh have differed with this percentage.

He said that Egypt wanted that the value addition margin should be at 50 percent, while Bangladesh sought at 30 percent. According to the preferential treaty, if six out of eight countries agreed on certain percentage then it would be sufficient for implementation of the treaty.

Asked about the delay in the finalization of the rules of origin, Mr Bashir said it was very difficult to come out with agreed rules as member countries were practicing different rules in the their respective countries.

He said that the two countries would now discuss the issue with their stakeholders particularly to get their support on 40 percent margin of value addition.

He said another meeting at technical level is expected before the holding of 6th D-8 Summit in Kula Lumpur on July 7-8, 2008. “I am hopeful that Bangladesh and Egypt will come in line with other members,” he said.

The head of the states are expected to attend the meeting, which will approve the rules of origin to implement the PTA during the D-8 summit.

Under PTA, the tariffs on selected products will be brought down to 10 percent among the member countries. Mr Bashir said that trade among the bloc will be through the positive list based. The only least developed country (LDC) Bangladesh was allowed to bring down tariff on the selected items in eight years instead of five years.

“At the initial phase the member countries may be requested to lower their tariffs at a certain percentage on a number of import items according to their choice: for example 10-20 per cent of their Harmonized System (HS) tariff lines,” an official in the foreign office said.

At subsequent stages, the number of import items that will be subject to tariff reduction and the depth of reductions may be increased in a progressive manner, he added.

An official announcement issued by foreign office said secretary general D-8 Dipo Alam called on the foreign secretary Riaz Muhammad Khan. He briefed Mr Khan on D-8’s achievements in fostering closer cooperation in the fields of trade, agriculture, energy, finance and shipping among the member countries.

The foreign secretary expressed Pakistan’s commitment to promoting intra D-8 trade. He appreciated the role being played by secretary general in making the D-8 a successful organisation.