[Pakistan] Wants U.S. free trade deal to cut poverty

From Reuters India

By Doug Palmer

WASHINGTON (Reuters) - Pakistan needs a free trade agreement with the United States to help fight poverty that fuels extremism, a top Pakistani official said on Tuesday.

Pakistan President Pervez Musharaff "feels very strongly the very strong political ties between Pakistan and the United States should also include economic ties," Pakistan Commerce Minister Humayun Akhtar Khan told reporters before a meeting with U.S. Trade Representative Rob Portman.

"(Musharaff) feels that in order to remove poverty, which is essential for curbing extremism in that part of the world, Pakistan needs market access and the United States being one of the largest trading partners should give that access to Pakistan," Khan said in Washington.

Pakistan, a close military ally of the United States, is one of several countries seeking a free trade deal with the United States. Al Qaeda leader Osama bin Laden, who is believed responsible for the Sept. 11, 2001 attacks on the United States, is thought to be hiding in the mountainous, remote border region of Afghanistan and Pakistan.

Musharaff asked U.S. President George W. Bush to begin free trade talks at a New York meeting in September, repeating a request he first made in 2004, Khan said.

Pakistan already is negotiating a bilateral investment treaty with the United States, which could be a stepping stone to a free trade deal. The two countries should set a deadline for finishing those talks next year, Khan said.

More than 85 percent of Pakistan's exports to the United States are textile and clothing products, which Khan acknowledged would present a problem in negotiating a free trade agreement. Most U.S. textile groups are opposed to any reduction in their tariff protections.

"The entire trade and economic relationship between the United States and Pakistan should not depend upon the issue of textiles. It should be looked at as a restraint which both the governments should resolve to remove rather than a stumbling block that nobody dares to climb," Khan said.

The U.S. State Department's warning for Americans not to travel to Pakistan also is hurting economic ties between the two countries, Khan said. Pakistan is looking forward to a possible visit by Bush next year and hopes he will bring a high-level business delegation with him, he said.