The Agreement on Early Harvest Programme (EHP) between Pakistan and China is operational with effect from 1st January 2006. The EHP along with annexes relating to tariff concessions and the time schedule for reduction of tariffs was signed and exchanged on 5th April 2005.The negotiations on Free Trade Agreement are going on. The FTA is expected to come into effect by the year 2007. Both sides are working hard to make this FTA an ideal win-win strategy.The Early Harvest Programme (EHP) is a mini fast track prelude to the FTA under negotiation. Both Pakistan and China have increased market access for each other on items of significant commercial interests. The EHP has provided duty free access to a substantial number of products within next two years. Apart from this, a large number of products will be exportable by both counties at Margin of Preference in relation to MFN duty rate. In this way both countries would enjoy concessionary duty rate in comparison to exports of same products from other countries. The details of the EHP are as under:
It has two types of tariff concessions
a) Tariff lines on which zero tariff will be applied immediately
b) Tariff lines on which duty will become zero in three years
The following annexes contain Immediate Concession Lists
The Annex-I contains a total of 386 tariff lines at 8-digit level and these products are entitled to enjoy Zero Tariff, when imported from China.
The Annex-II contains a total of 644 tariff lines at 8-digit level and these products are entitled to enjoy Zero Tariff, when Exported to China.
The Annex-III contains a total of 100 tariff lines at 8-digit level and these products are entitled to enjoy Zero Tariff, when Exported or Imported to and from China.
The following annexes contain lists of tariff lines on which duty will become zero in three stages over three years:
The Annex-IV contains the tariff reduction modality of the zero-tariff products categorized as under:
CATEGORY 1 PRODUCTS WITH APPLIED MFN DUTY<15%
CATEGORY 2 PRODUCTS WITH APPLIED MFN DUTY <5%>15%
CATEGORY 2 PRODUCTS WITH APPLIED MFN DUTY >5%