WORLD TRADE  
ORGANIZATION  WT/REG237/1  
1 December 2008 
 (08-5874) 
Committee on Regional Trade Agreements  
  
 
    
 
 
FACTUAL PRESENTATION 
 
Free Trade Agreement between  
Pakistan and China 
(Goods) 
 
Report by the Secretariat 
 
 
 
 
This report, prepared for the considera tion of the Free Trade Agreement between 
Pakistan and China has been drawn up by the WTO Secretariat on its own 
responsibility and in full consultation with the Parties.  The report has been drawn 
up in accordance with the rules and pro cedures contained in the Decision for a 
Transparency Mechanism for Regiona l Trade Agreements (WT/L/671).  
 
Any technical questions arising from this report may be addressed to 
Ms. Jo-Ann Crawford (tel: +41 22 739 5422).  WT/REG237/1 
 Page iii 
 
 
  TABLE OF CONTENTS 
  
  Page 
 
I. TRADE ENVIRONMENT 1 
A. M
ERCHANDISE TRADE  1 
II. CHARACTERISTIC ELEMENT S OF THE AGREEMENT 5 
A. B ACKGROUND INFORMATION  5 
III. NATIONAL TREATMENT AND MARK ET ACCESS PROVISIONS OF THE 
AGREEMENT 5 
A. I MPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  5 
1. General provisions 5 
2. Liberalization of trade and tariff lines 6 
3. Pakistan's liberalization schedule 7 
4. China's liberalization schedule 9 
B. R ULES OF ORIGIN  10 
C. E XPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  11 
D. R EGULATORY PROVISIONS OF THE AGREEMENT  11 
1. Standards 11 
(a) Sanitary and phytosanitary measures 11 
(b) Technical barriers to trade 11 
2. Safeguard mechanisms 12 
(a) Global safeguards 12 
(b) Bilateral safeguards 12 
3. Anti-dumping and co untervailing measures 13 
4. Subsidies and State-aid 13 
5. Other regulations 13 
(a) Customs-related procedures 13 
(b) Transparency 13 (c) Intellectual Property 13 
(d) Investment 13 
E. S
ECTOR -SPECIFIC PROVISIONS OF THE AGREEMENT  14 
IV. GENERAL PROVISIONS  OF THE AGREEMENT 14 
A. E XCEPTIONS AND RESERVATIONS  14 
B. A CCESSION  14 
C. I NSTITUTIONAL FRAMEWORK  14 
D. D ISPUTE SETTLEMENT  14 
E. R ELATIONSHIP WITH OTHER AGREEMENTS CONCLUDED BY THE PARTIES  16 
ANNEX I 17  WT/REG237/1 
 Page 1 
 
 
  PAKISTAN-CHINA FREE TRAD E AGREEMENT (GOODS) 
 
Factual Presentation by the Secretariat  
  
I. TRADE ENVIRONMENT 
1. The Free Trade Agreement (FTA) between the Is lamic Republic of Pakistan and the People's 
Republic of China (hereafter "the Agreement") is Paki stan's first and China's fourth bilateral regional 
trade agreement (RTA) notified to the WTO.  Alt hough quite different in term s of population size, the 
countries have similar economic structures.  In 2006, manufactures accounted for 81.4% and 
agricultural products for 13.1% of Pakistan's merchandise exports, while for China manufactures 
accounted for 92.4% and agricultural produc ts for 3.4% of merchandise exports.
1   
2. Pakistan's GDP was US$128.8 billion in 2006, while that of China reached 
US$2.668 trillion.2  With total merchandise exports of US$16.9 billion and imports of 
US$29.8 billion, Pakistan ranked in 2006 as the world's 65th top exporter and the 50th top importer;  
with merchandise exports of US$968.9 billion and imports of US$791.5 billion, China ranked as the 
3rd top exporter and importer in that year.3  The two economies showed average trade/GDP ratios in 
2004-2006 of 40.6 (Pakistan) and 69.0 (China). 
A. MERCHANDISE TRADE  
3. Developments in recent years in global and in tra-Party merchandise trade are presented in 
Charts I.1 and I.2.  Over the period surveyed (1998-2006), Pakistan has run a growing trade deficit 
with China. 
                                                      
1 WTO Statistics Database, Trade Profiles. 
2 WTO Statistics Database, Trade Profiles. 
3 UNSD, Comtrade database (2007). WT/REG237/1 
Page 2  
 
  051015202530
1998 1999 2000 2001 2002 2003 2004 2005 20060.00.51.01.52.02.53.0US$billion US$billionChart I.1 - Pakistan: Merchandise imports from and exports to 
world and China, 1998-2006
Source: UNSD, Comtrade database.Imports from China
Exports to ChinaTotal imports
Total exportsLeft hand scale: Right hand scale:
 
 
 
01002003004005006007008009001,000
1998 1999 2000 2001 2002 2003 2004 2005 20060.00.51.01.52.02.53.03.54.04.55.0US$billion US$billionChart I.2 - China: Merchandise imports from and exports to world 
and Pakistan, 1998-2006
Source: UNSD, Comtrade database.Imports from Pakistan
Exports to PakistanTotal imports
Total exportsLeft hand scale: Right hand scale:
 
 
 
 
  WT/REG237/1 
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  4. On the basis of 2006 data from the United Nati ons' Comtrade database, China is Pakistan's 
3rd largest trading partner in terms of imports, acco unting for 9.8% of Pakistan's imports, and ranks 
11th for Pakistan's exports (3.0% of its exports).  Pakistan is China's 54th largest trading partner in 
terms of imports, accounting for 0. 13% of China's imports, and its 33rd for exports, accounting for 
0.44% of China's exports. 
5. The commodity structure of trade among the Parti es, as well as of their imports and exports to 
the world in the period 2004-06, is shown in Chart I.3, on the basis of HS section product categories. 
6. Three product categories – machinery, chemic als, and textiles – accounted for 64% of 
Pakistan's imports from China in the period 2004- 2006;  base metals and plastics accounted for a 
further 12.7%.  China's three largest export product categories – machinery, textiles, and base metals 
– made up 64.7% of its total expor ts in 2004-2006 and accounted for 56.1% of Pakistan's imports 
from China. 
7. A single product category – textiles – accounted fo r 72.5% of China's imports from Pakistan 
in the period 2004-2006.  Pakistan's three largest e xport product categories – textiles, vegetables, and 
raw hides – made up 79.4% of its total exports in the period 2004-2006 a nd accounted for 79.6% of 
China's imports from Pakistan. 
 
 WT/REG237/1 
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  Chart I.3
Pakistan and China: product compos ition of merchandise trade, annual 
average 2004-06
Pakistan's imports from China China's imports from Pakistan
 Source:  UNSD, Comtrade database.Per cent
Total:  US$2.3 billion Total:  US$811.7 million
Total:  US$24.3 billion Total: US$670.9 billion
Total:  US$15.5 billion Total:  US$774.7 billionPakistan's global exports China's global exportsPakistan's global imports China's global imports Minerals 3.7
Machinery
42.3Vehicles 4.8
Minerals 2.5
Chemicals 4.1Optical 7.6
Textiles
64.8Other 
13.1Other 
9.6
Miscellaneous 2.7Machinery 41.4
Base metals 7.8
Vehicles 3.8
Base metals 8.0 Textiles 7.3
Minerals 4.8Other
5.7Other 
3.8
Plastics 3.0Other 
8.5Stone & cement  4.2
Vehicles  7.9Minerals 23.7
Machinery 21.1Textiles 5.1
Chemicals  12.2Plastics 5.0Textiles 72.5Miscellaneous 2.1
Other 
6.9
Vehicles  3.4Prepared foods 2.3
Chemicals  7.4Chemicals 14.9Machinery 41.8
Minerals 14.1Base metals 7.0Vegetables 2.9
Plastics 5.7Chemicals  3.1
Miscellaneous 5.9Raw hides 6.3
Base metals 8.2Plastics 5.9
Raw hides 6.0
Vegetables 8.6Optical 3.6Vegetables 4.5Fat and oils 3.5
Footwear 2.9Base metals 10.4Minerals 3.9
Textiles 3.6
Textiles 14.4
 
  WT/REG237/1 
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  II. CHARACTERISTIC ELEMENTS OF THE AGREEMENT 
A. BACKGROUND INFORMATION  
8. The Free Trade Agreement was signed by the Islamic Republic of Pakistan and the People's 
Republic of China on 24 November 2006 and entered into force on 1 July 2007.   
9. The Agreement was notified to the WTO by the Parties on 18 January 2008 under 
Article XXIV:7(a) of GATT 1994.  The text is availabl e, together with its Annexes, on the Parties'  
official websites.4   
10. The Agreement is composed of 12 Chapters containing 83 Articles, as follows: 
Box II.1:  Table of Co ntents of the Agreement 
Chapter I Initial Provisions 
Chapter II General Provisions Chapter III National Treatment and Market Access for Goods 
Chapter IV Rules of Origin 
Chapter V Trade Remedies Chapter VI Sanitary and Phyto-sanitary Measures (SPS) 
Chapter VII Technical Barriers to Trade (TBT) 
Chapter VIII Tr ansparency 
Chapter IX Investments 
Chapter X Dispute Settlement 
Chapter XI Administration Chapter XII Final Provisions
 
 
11. In addition, the Agreement contains three annex es with the following:  elimination of import 
customs duties;  certificate of origin;  and rules of procedure of the arbitral panel.   
12. The Agreement contains no explicit transition pe riod:  for both Parties tariff reductions or 
eliminations for the first phase are to be completed within a period of five years, i.e. by 1 January 
2012.  Duty eliminations or reductions took place on the date of entry into force of the Agreement, i.e. 
1 July 2007 and are scheduled to take place on 1 Janua ry in subsequent years.  According to Article 
8.3 of the Agreement, the first review and modi fication of the tariff reduction modality is to be 
undertaken by the end of 2011 or the beginning of 2012.5   
III. NATIONAL TREATMENT AND MARKET ACCESS PROVISIONS OF THE 
AGREEMENT 
A. IMPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  
1. General provisions 
13. The Parties agree to accord national treatment to  the goods of the other party in accordance 
with Article III of the GATT 1994 (Article 7 of the Agreement). 
                                                      
 4 http://www.commerce. gov.pk/PCFTA.asp  
http://gjs.mofcom.gov.cn/aarticle/a f/fazzn/200611/2 0061103845345.html  and 
 http://fta.mofcom.gov.cn/pakistan/xieyiwenben.shtml  
5 According to the Parties, the first review of th e implementation of the Agreement may take place by 
the end of 2008. WT/REG237/1 
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  14. Market access provisions for the reduction and/or elimination of customs duties are addressed 
in Annex I.  Tariff liberalization covers Chapters 1-97 of the Harmoni zed System (HS).  In the case of 
Pakistan, the first phase of the Agreement provid es for six different categories of tariff reduction 
modalities as follows:  elimination of tariffs within  three years (I);  duties reduced to 5% or below 
within five years (II);  duties reduced by a margin of preference of 50% within five years (III);  duties 
reduced by a margin of preference of 20% within  five years (IV);  no concession (V);  and excluded 
(VI).  For China for the first phase of the Agreem ent five categories are foreseen:  elimination of 
tariffs within three years (I);  duties reduced to 5% or below within five years (II);  duties reduced by 
a margin of preference of 50% within five years (III);   duties reduced by a margin of preference of 
20% within five years (IV);  and no concession (V).   
15. If a Party reduces its applied MFN rate after the entry into force of the Agreement and before 
the end of the tariff elimination period, the tariff e limination schedule is to be applied to the reduced 
rate (Article 8.2).  Upon request by either Part y, the Parties agree to consider accelerating the 
elimination of customs duties (Article 8.3).  The Parties agree to review and modify the tariff reduction modalities every five years.  The first review is scheduled to take place either at the end of 
the fourth year or at the beginning of the fifth year after entry into force of th e Agreement, i.e. by end 
2010 or the beginning of 2011 (Article 8). 
16. Under Phase II of the Agreement, the Parties agr ee to eliminate tariffs on no less than 90% of 
products, both in terms of tariff lines and tr ade volume within a reasonable period of time.
6 
2. Liberalization of trade and tariff lines7  
17. The elimination of tariffs applicable between the Parties is detailed in their corresponding 
schedules.  Tariff elimination began on the date of entry into force of th e Agreement, i.e. 1 July 2007;  
subsequent reductions or eliminati ons of duties take place on 1 January of following years.  The base 
rate used for tariff reductions is the applied MFN rate (2006).     
18. The overall tariff elimination under the Agreem ent is depicted in Tables III.1A and III.1B 
below.8  In the case of Pakistan, 5.8% of total tariff lines were already duty-free on an MFN basis in 
2006.9  A further 7.0% of tariff lines became duty-fr ee for imports from China in 2007;  in terms of 
imports from China for the period 2004-2006, these fi gures amount to 11.6% and 9.4%, respectively.  
By the end of the transition period in 2012, a further 23.6% of tariff lines are to be liberalized, accounting for 23.4% of imports from China for the period 2004-2006.
10  Thus, a total of 36.4% of 
tariff lines are liberalized under th e Agreement, corresponding to 44.4% of imports by value from 
China for the period 2004-2006. 
 
   
 
                                                      
6 According to the Parties the second phase of th e Agreement will begin after completion of the first 
phase of tariff elimination/reduction.  The period of completion of the second phase will be negotiated by the Parties. 
7 Unless otherwise specified, all statistics, tables and charts contained in this document have been 
prepared on the basis of data  provided by the Parties. 
8 Tariff lines containing in-quota duties are ex cluded from all the tari ff-related calculations. 
9 Pakistan's tariff is composed of 6,911 tariff lines at the HS 8-digit level, of which 6,867 contain 
ad valorem  rates;  the remaining 44 lines are subject to specific duties.   
10 2010 is the last year when tariffs are scheduled to  be fully liberalized.  Further tariff reductions are 
scheduled to take place in 2011 and 2012.  WT/REG237/1 
 Page 7 
 
 
  Table III.1A 
Tariff elimination commitments under the Agreement and corresponding average trade 
A. Pakistan 
Duty phase-out 
period Number of lines % of total lines in 
Pakistan's tariff 
schedule Value of Pakistan's imports 
from China (2004-2006) 
in million US$ % of Pakistan's total 
imports from China 
2004-2006 
MFN duty free 
(2007) 399 5.8 226.4 11.6 
2007 486 7.0 184.4 9.4 
2008 31 0.4 0.8 0.0 
2010 1,601 23.2 457.0 23.4 
Remain dutiable 4,394 63.6 1,088.3 55.6 
Total 6,911 100.0 1,956.9 100.0 
  
Source:  WTO Secretariat based on data provided by Pakistan and WTO-IDB (2004 Imports from China). 
 Exchange rates Pakistan rupees per US dol lar: 2005: 59.5145 ; 2006: 60.2713 (Source: IFS) 
 
19. In the case of China, 8.4% of total tariff lin es were already duty-free on an MFN basis in 
2007.11  A further 9.4% of tariff lines became duty-free for imports from Pakistan in 2007;  in terms 
of imports from Pakistan for the period 200 4-2006, these figures amount to 3.7% and 15%, 
respectively.  By the end of the transition period in 2012, a further 17.7% of tariff lines are to be liberalized, accounting for a further 11.6% of imports from Pakistan for the period 2004-2006.
12  
Thus, a total of 35.4% of tariff lines are liberali zed under the Agreement, corresponding to 30.3% of 
imports by value from Pakistan for the period 2004-2006. 
Table III.1B 
Tariff elimination commitments under the Agreement and corresponding average trade 
B. China 
Duty phase-out 
period Number of lines % of total lines in 
China's tariff schedule Value of China's imports 
from Pakistan (2004-2006) 
in million US$ % of China's total 
imports from Pakistan 
2004-2006 
MFN duty free 
(2007) 640 8.4 28.8 3.7 
2007 720 9.4 117.2 15.0 
2008 59 0.8 0.3 0.0 
2010 1,291 16.9 90.8 11.6 
Remain dutiable 4,936 64.6 544.8 69.7 
Total 7,646 100.0 781.8 100.0 
  
Source:  WTO Secretariat based on data provided by China.  
 
3. Pakistan's liberalization schedule 
20. The base rates used by Pakistan for implemen ting its tariff liberalization scheme provided for 
5.8% of tariff lines being duty free before the entry in to force of the Agreement.  As can be seen from 
Chart III.1, most of the lines freed of duties in 2007, 2008 and 2010 are subject to rates of 10% or 
                                                      
11 China's tariff is composed of 7,646 tariff lines at  the HS 8-digit level, of which 7,597 are subject to 
ad valorem  rates.  For the 49 lines subject to specific duties, China has provided ad valorem  equivalent rates.  
Such lines occur in HS Chapters 2, 5, 37, and 85. 
12 2010 is the last year when tariffs are scheduled to  be fully liberalized.  Further tariff reductions are 
scheduled to take place in 2011 and 2012. WT/REG237/1 
Page 8  
 
  less.  In 2011 and 2012, duties on some products are reduced, but no elimination of duties takes place.  
The 4,394 tariff lines which remain subject to duties have a range of 2.25% to 90%.   
0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200 2,400 2,600200720082009201020112012Chart III.1
Pakistan's duty elimination under the Agreement
Year of duty free treatment   
Source: WTO Secretariat estimates, based on data provided by Pakistan.Number of duty-free lines (cumulative)
Duty-free <10% <20% <30% MFN is: <40% >50%
 
 
21. Table III.2 shows Pakistan's trade liberaliza tion commitments under the Agreement on the 
basis of products' treatment at the HS 8-digit level organized by HS section product categories.  Of the 
6,911 tariff lines forming Pakistan's tariff schedul e, 399 tariff lines were already duty-free on an MFN 
basis in 2007;  the lines liberalized upon entry into force of the Agreement and in 2008 are 
agricultural products, minerals, chemicals, and machinery.  In 2010, an additional 1,602 lines 
covering most HS sections are subject to liberali zation.  The 4,394 lines which remain subject to 
duties cover all HS sections. 
Table III.2 
Pakistan: Tariff elimination under the Agreement, by HS section 
Number  of duty-free 
lines  HS section and description  MFN 
average
% Total 
No of 
lines  MFN 
2007  2007 2008 2010 Remain 
dutiable  Average Final 
Tariff 
(Dutiable)  
I Live animals and animal products 11.7 248 24 86  20 118 15.3 
II Vegetable products 10.9 312 68 21 14 52 157a 11.7 
III Animal or vegetable fats and oils 11.8 54    3 51a 9.9 
IV Prepared food etc. 24.1 229    12 217 20.6 
V Minerals 8.2 195 23 46 12 50 64 5.9 
VI Chemical and products 8.3 1,153 51 112 1 551 438a 10.0 
VII Plastics and rubber 16.9 300 21   30 249 17.0 
VIII Hides and skins 10.2 93 38   17 38 15.0 
IX Wood and articles 12.1 106 34   5 67 12.2 
X Pulp, paper etc. 16.0 182 28   21 133 17.9 
XI Textile and textile ar ticles 18.8 921 30   3 888 16.0 
XII Footwear, headgear 23.2 53     53 11.4 
XIII Articles of stone 21.9 191    10 181 16.6 
XIV Precious stones, etc. 5.0 60 3   49 8a 5.0 
Table III.2 (Cont'd)   WT/REG237/1 
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  Number  of duty-free 
lines  HS section and description  MFN 
average
% Total 
No of 
lines  MFN 
2007  2007 2008 2010 Remain 
dutiable  Average Final 
Tariff 
(Dutiable)  
XV Base metals and  products 13.7 761 24   200 537 13.6 
XVI Machinery 12.8 1,247 46 221 4 338 638 17.6 
XVII Transport equipment 33.3 287 1   48 238 38.6 
XVIII Precision equipment 9.4 274 7   183 84 15.5 
XIX Arms and ammunition 20.2 52     52 5.0 
XX Misc. manufactured articles 20.5 186 1   4 181 11.6 
XXI Works of art, etc. 5.7 7    5 2 7.5 
Total 14.5 6,911 399 486 31 1,601 4,394 16.1 
a  Mixture of ad valorem  and specific duties (tariff lines with specifi c duties are excluded from the computation). 
 
Source:  WTO estimates based on data provided by Pakistan. 
 
4. China's liberalization schedule 
22. The base rates used by China for implemen ting its tariff liberalization scheme already 
provided for 8.4% of tariff lines being duty free before the entry into force of the Agreement.  As can be seen from Chart III.2, most of the additional 9.4%  of tariff lines freed upon entry into force held 
base rates of 10% or less.  Further eliminations of  duties are scheduled to take place in 2008 and 2010.  
In 2011 and 2012, duties on some products are reduced, but no elimination of duties takes place.  The 
4,936 tariff lines which remain subject to duties have a range of 2% to 65%. 
0 500 1,000 1,500 2,000 2,500200720082009201020112012Chart III.2
China's duty elimination under the Agreement
Year of duty free treatment   
Source: WTO Secretariat estimates, based on data provided by China.Number of duty-free lines (cumulative)
Duty-free <10% <20% <30% MFN is:
 
 
23. Table III.3 shows China's trade liberalizati on commitments under the Agreement at the 
HS 8-digit level organized by HS section product cate gories.  Of the 7,646 lines forming China's tariff 
schedule, 640 lines were already MFN duty-free in 2007;  an additional 720 tariff lines were liberalized upon entry into force of the Agreemen t (comprising both agricultural and industrial 
products).  A total of 4,936 tariff lines covering all HS sections remain  dutiable under the Agreement.  WT/REG237/1 
Page 10  
 
  Table III.2 
China: Tariff elimination under the Agreement, by HS section 
Number of duty-free 
lines  HS section and description  MFN 
average
% Total 
No of 
lines  MFN 
2007  2007 2008 2010 Remain 
dutiable  Average Final 
Tariff 
(Dutiable)  
I Live animals and animal products 12.2 377 44   8 325a 10.3 
II Vegetable products 14.5 457 48 62 3 53 291 15.4 
III Animal or vegetable fats and oils 12.9 53  2   51 12.9 
IV Prepared food etc. 18.0 279 1 4 2 38 234 18.0 
V Minerals 3.7 199 37 64  57 41 5.3 
VI Chemical and products 6.9 1,189 9 75  414 691a 6.6 
VII Plastics and rubber 9.6 263 1   21 241 7.1 
VIII Hides and skins 12.3 106  3 4 18 81 10.6 
IX Wood and articles 4.3 189 72   30 87 6.1 
X Pulp, paper etc. 5.3 160 35    125 6.6 
XI Textile and textile artic les 11.6 1,105  437 33 67 568 8.4 
XII Footwear, headgear 18.4 56     56 13.7 
XIII Articles of stone 13.5 184 1 6 10 6 161 9.8 
XIV Precious stones, etc. 10.0 84 32 1  13 38 18.4 
XV Base metals and  products 7.4 714 4 13 7 251 439 6.6 
XVI Machinery 8.4 1,398 260 3  210 925a 7.7 
XVII Transport equipment 12.3 318 1   65 252 11.7 
XVIII Precision equipment 10.2 307 31 28  40 208 10.7 
XIX Arms and ammunition 13.0 21     21 6.5 
XX Misc. manufactured articles 11.6 178 62 22   94 17.4 
XXI Works of art, etc. 9.6 9 2    7 7.5 
Total 9.8 7,646 640 720 59 1,291 4,936 9.4 
a  Mixture of ad valorem  and specific duties (tariff lines with specifi c duties are excluded from the computation). 
 
Source:   WTO estimates based on data provided by the China authorities. 
 
B. RULES OF ORIGIN  
24. Disciplines regarding rules of origin are set out in Chapter IV of the Agreement.  Article 12 
defines the terms used and Articles 13-24 provide the substantive rules.  
25. A good is considered as originating when it (Article 13): 
(a) is wholly obtained or produced in one of the Parties;13  or 
(b) fulfils a minimum local value content of 40% determined in accordance with 
Article 15;  or 
(c) has undergone sufficient transformation in accordance with the product specific 
criteria annexed to the rules of origin.14 
                                                      
 13 "Wholly obtained" applies to goods obtained in one or both of the Parties that are plant and plant 
products harvested, picked or gathered there;  live animals born and raised there;  products obtained from live 
animals;  products obtained from hunting, trapping, fishing, aquaculture, gathering or capturing conducted there;  minerals and other naturally occurring substances, extracted or taken from their soil, waters, seabed or beneath 
their seabed;  products taken from the waters, seabed or beneath the seabed outside the territorial waters of that 
Party;  provided that that Party has the right to explo it such waters, seabed and beneath the seabed in accordance 
with international law;  products of sea fishing and other marine products taken from the high seas by vessels 
registered with a Party or entitled to fly the flag of that Party;  products processed and/or made on board factory 
ships registered with a Party or entitled to fly the flag of that Party;  parts or raw materials recovered there from 
articles which can no longer perform their original pur pose nor are capable of being restored or repaired;  
articles collected there which can no longer perform their original purpose nor are capable of being restored or 
repaired and are fit only for disposal or recovery of parts of raw materials, or for recycling purposes;  waste and scrap resulting from manufacturing operations conducted there;  and goods obtained or produced in a Party 
solely from the aforementioned products.  WT/REG237/1 
 Page 11 
 
 
  26. Bilateral cumulation is allowed under the Agreemen t (Article 16) i.e., cumulation in terms of 
materials and components between the Parties.   
27. Article 18 of the Agreement provides a list of  minimal, non-qualifying operations carried out 
in the territory of the Parties which do not confer origin.  Products may be transported through third 
countries as long as they satisfy the conditions sp ecified in Article 19.  Additional rules in 
Articles 20-22 clarify how certain materials (packagi ng materials;  accessories, spare parts or tools; 
and indirect materials) are to be treated/v alued when determining the origin of goods. 
Box III.1:  Rules of Origin:  Basic Features at a Glance 
• A single rule of origin methodology – minimum local value content of 40% - applies. 
• Bilateral cumulation. 
• No tolerance rule.    
• Outward-processing not authorized. 
• Transit through third parties authorized only under certain conditions. 
Source:  WTO Secretariat 
 
C. EXPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  
28. There are no provisions on export duties and charges in the Agreement. 
D. REGULATORY PROVISIONS OF THE AGREEMENT  
1. Standards 
(a) Sanitary and phytosanitary measures 
29. Chapter VI lays down the provisions applying to sanitary and phytosanitary measures.  In 
Article 29 the Parties reaffirm their existing righ ts and obligations under the WTO Agreement on the 
Application of SPS Measures.   With regard to transparency, they  agree to cooperate as per the 
transparency requirements of the SPS Agreement and to  exchange information related to sanitary and 
phytosanitary conditions in their territories.  Artic le 34 provides for the establishment of a Committee 
on Sanitary and Phytosanitary matters composed of each Party's representatives within two months of 
the Agreement's entry into force.   The Committee meets at least on ce a year unless the Parties agree 
otherwise.   
(b) Technical barriers to trade 
30. Chapter VII lays down the provisions applying to standards and technical regulations.  The 
Parties reaffirm their existing rights and oblig ations with respect to each other under the 
WTO Agreement on Technical Barriers to Trade  and agree to use international standards or relevant 
parts thereof as the basis for their technical regula tions and related conformity assessment procedures.    
Article 39 provides for the Parties, through consulta tion, to seek to identify specific cooperation areas 
and products, and arrange for cooperative implementation initiativ es.  Article 40 provides for a range 
of measures to improve transparency of techni cal regulations including electronic transmission of 
proposals to the other Party's inquiry point.  In Article 41, the Parties agree to establish a Joint 
Committee on Technical Barriers to Trade to monitor the implementation and administration the provisions of Chapter VII.  The Committee meets at  least once a year unless agreed otherwise by the 
Parties.   
                                                                                                                                                                    
 
14 According to the Parties, no produ ct specific rules of origin have been negotiated thus far.  Such 
rules will be annexed to the rules of origin when negotiated. WT/REG237/1 
Page 12  
 
  2. Safeguard mechanisms 
(a) Global safeguards 
31. Under Article 26 the Parties maintain their rights and obligations under Article XIX of 
GATT 1994 and the Agreement on Safegua rds.  Actions taken pursuant to WTO rules are not subject 
to the Agreement's rules on dispute settlement.   
(b) Bilateral safeguards 
32. Article 27 sets out the rules that apply to th e imposition of a bilatera l safeguard measure.  
During the transition period
15, a Party may impose a bilatera l safeguard measure on a product 
benefiting from preferential tariff treatment under the Ag reement if there is an increase in imports in 
absolute terms and under such conditions as to constit ute a substantial cause of serious injury or threat 
thereof to the domestic industry of the importin g Party producing a like or directly competitive 
good.16  Disciplines regarding the application of such measures include an investigation by the Party's 
competent authorities prior to its application;  its scope and duration;  consultation procedures;  and 
compensation.  The Parties agree within five years of  the entry into force of the Agreement to meet to 
determine whether there is a need to maintain th e bilateral safeguard mechanism.  The conditions 
applicable to the use of bilateral sa feguards are detailed in Table III.4. 
Table III.4:  Conditions applied to th e application of bilateral safeguards 
 Specific Conditions 
Precondition Rise in imports In absolute terms  
Criteria  Serious injury or actual threat thereof to 
the domestic industry 9  
Measures allowed 
 Suspension of further duty reduction, or 
increase in duty rate to a level not to 
exceed the lesser of i)  the applied MFN rate in effect  when measure was taken, or the 
applied MFN rate in effect on da te of entry into  force of the 
Agreement. 
ii)  For seasonal goods, the applied MFN rate in effect for the 
immediately preceding corresponding season, or the applied MFN 
rate in effect on the date of en try into force of the Agreement. 
Timing Maximum duration, including extension  Two years plus one year extension 
 Safeguard measure may be applied  
during the transition period of the good 
concerned   Retention of the measures to be reviewed at the end of the transition 
period, i.e. five years from date of entry into force of  the Agreement.  
Conditions or 
limitations  Information of the institution of a 
proceeding through written notice In accordance with Article 3 of the WTO Agreement on Safeguards 
 Consultation 9 
 Prior investigation  In acco rdance with Article 4 of the WTO Agreement on Safeguards 
 Compensation  Immediate compensation.  Retaliati on only after 18 months from the 
imposition of the safeguard measure. 
 Imposition of a global safeguard 
measure  No bilateral safeguard measure may be taken against a particular 
good while a global safeguard measure in respect of that good is in 
place.  Upon imposition of a global safeguard measure, any existing 
bilateral safeguard measure is to be terminated. 
Source: WTO Secretariat. 
                                                      
15 The transition period means the "five-year period  in the first phase of customs duty reduction or 
elimination".  The Parties will meet to determine the definition of the transition period of the second phase of 
tariff liberalization. 
16 "Serious injury" is defined in Article 27.1 of the Agreement as "a significant overall impairment in 
the position of a domestic industry".  A threat of serious in jury means "serious injury that, on the basis of facts 
and not merely on allegation, conjecture or remote possibility, is clearly imminent".  WT/REG237/1 
 Page 13 
 
 
  3. Anti-dumping and countervailing measures 
33. Under Article 25 of the Agreement the Parties maintain their rights and obligations under the 
Agreement on the Implementation of Article VI of the GATT 1994 and the Agreement on Subsidies 
and Countervailing Measures.  Antidumping actions ta ken pursuant to the WTO agreements shall not 
be subject to the Agreement's rules on dispute settlement. 
4. Subsidies and State-aid 
34. The Parties maintain their rights and obligati ons under the WTO Agreement on subsidies and 
countervailing measures (Article 25).   
5. Other regulations 
(a) Customs-related procedures 
35. Customs procedures related to rules of origin  are detailed in Annex II which contains a 
sample of the certificate of origin which is to be issued by the government authority designated by the 
exporting Party and notified to the other Party in accordance with the operational certification 
procedures, as laid out in Annex II.   
(b) Transparency 
36. Chapter VIII provides for a range of measu res to promote transparency including the 
establishment of contact points;  prompt publication of measures on any matter covered by the Agreement;  notification and provision of informa tion;  and access to confidential information. 
(c) Intellectual Property 
37. Article 10 provides that any right holder initia ting procedures for suspension by the customs 
authorities of the release of suspected counterfeit trademark or pirated copyright goods into free 
circulation is required to provide adequate evidence to satisfy the co mpetent authorities that, under the 
relevant laws of the Party importing the goods, ther e is prima facie an infringement of the right 
holder's IPR and to supply sufficient informat ion to make the suspected goods reasonably 
recognizable to the customs authorities. 
(d) Investment 
38. Chapter IX of the Agreement sets out the provisi ons relating to investment.  Investment is 
defined as every kind of asset invested by invest ors of one Party in accordance with the laws and 
regulations of the other Party in the territory of  the latter, including movable and immovable property 
and other property rights such as mortgages, pledges and similar rights;  shares, debentures, stock and 
any other kind of participation in companies;  clai ms to money or to any other performance having an 
economic value associated with an investment;  inte llectual property rights, in particular copyrights, 
patents, trade-marks, trade-names, technical  process, know-how and good-will;  and business 
concessions conferred by law or under contract permi tted by law, including concessions to search for, 
cultivate, extract or exploit natural resources.  I nvestors are defined as natu ral persons who have the 
nationality of either Party in accordance with its  laws, and legal entities, including companies, 
associations, partnerships and ot her organizations, incorporated or constituted under the laws and 
regulations of either Party and having their seats in that Party. 
 WT/REG237/1 
Page 14  
 
  39. Further provisions of Chapters IX relate to  the promotion and protection of investment, 
treatment of investors and investments, expr opriation, compensation for damages and losses, 
transfers, subrogation, and the settlement of disput es between Parties and between investors and one 
Party.   
E. S
ECTOR -SPECIFIC PROVISIONS OF THE AGREEMENT  
40. There are no sector-specific provisions in the Agreement. 
IV. GENERAL PROVISIONS OF THE AGREEMENT 
A. EXCEPTIONS AND RESERVATIONS  
41. There are no provisions in the Agreement relating to exceptions and reservations.   
B. ACCESSION  
42. There is no provision in the Agreement for the accession of third parties. 
C. INSTITUTIONAL FRAMEWORK  
43. Article 11 provides for the establishment of  a Committee on Trade in Goods, comprising 
representatives at the level of joint secretary, dir ector general or deputy di rector general.  The 
Committee's functions include promoting trade in  goods between the Parties, including through 
consultations on accelerating tariff elimination unde r the Agreement;  addressing barriers to trade in 
goods between the Parties, especially those relate d to the application of non-tariff measures;  
monitoring and evaluating the implementation of tariff reduction schedules;  and any other issue 
related to trade in goods, referred to by either Party. 
44. Article 75 provides for the establishment of  a Free Trade Commission responsible for 
supervising the implementation and interpretation of the Agreement.  It is also responsible for 
facilitating the avoidance and settlement of disputes a nd the supervision of the work of all committees 
and working groups established under the Agreement.   The Free Trade Commission meets at least 
once a year in regular session, or as otherwise mutually determined by the Parties.  
D. DISPUTE SETTLEMENT  
45. Chapter X sets out the procedures that apply to the avoidance and settlement of disputes 
between the Parties regarding questions of interpre tation or application of the Agreement.  In the 
event that consultations between the Parties fail to  settle the dispute an arbitral tribunal may be 
appointed.  Article 60 provides for a forum election clause for matters falling under both the Agreement and other agreements to which both Pa rties are party; however, once the complaining 
Party has chosen the forum to settle the dispute, that forum shall be used to the exclusion of the others 
(exclusive forum clause).   
46. The Agreement provides for detailed steps for di spute resolution, the most salient of which 
are synoptically described below.  It requires the Parties to establish ru les of procedure to ensure that 
they have the right to a hearing before the ar bitral panel and the opportunity to present initial 
submissions and counter-submissions in writing (Annex III).  The hearings before the arbitral panel, 
the deliberations and preliminary report, as well as all the communications presented are confidential 
(see Table IV.1).  The Parties may, however, disclo se statements of their own positions to the public.  WT/REG237/1 
 Page 15 
 
 
  Table IV.1 
Synopsis of the Pakistan-China FTA's Dispute Settlement Provisions 
 
 
 
    
 
     
 
  
-Consultations  (Art. 59) 
Referral to the Commission  (Art. 61) 
Composition  (Art. 63) 
Rules of procedure  (Annex III) 
Hearings  (Annex III) 
Panel final report  (Art. 70) 30 or 15 days (perishable goods) 
Written request for establishing an 
Arbitral Panel (Art. 62) 60 or 30 days (perishable goods) 
Max 60 days for composition 
Panel initial report to be sent to 
the Parties   (Art. 69) 
Report becomes public  (Art. 70.4) 15 days from Parties' release Implementation  
In agreement by the Parties (Art 71) 
Non-implementation   
Negotiations on mutually acceptable 
compensation (Art. 72.1) 30 days from receipt of final report 
failure to reach agreement 
Suspension of Benefits (Art. 72.1) 
− If no agreement on compensation (30 days), 
complaining Party may suspend benefits  
Arbitral Panel Determination (Art. 72) 
− if Party considers level of suspension of 
benefits is excessive 
Referral to original Panel determination 
(Art. 73) 60 days from reques t 
Release of Arbitral Report (Art. 73.2)  
90 days after referral 90 days or 60 days (perishable goods) 
30 days WT/REG237/1 
Page 16  
 
  E. R
ELATIONSHIP WITH OTHER AGREEMENTS CONCLUDED BY THE PARTIES  
47. Table IV.2 lists the regional trade agreements  (RTAs), (notified and non-notified to the 
GATT/WTO and in force), as of 1 August 2008 to which Pakistan and China are parties.   
Table IV.2   
Pakistan and China:  Participation in other RTAs (n otified and non-notified in force) as of November 2008  
 
Partner / Agreement GATT/WTO Notification 
 Date of entry  
into force Type of 
agreement 
Year WTO Provision 
PAKISTAN 
Malaysia 01.01.08 Goods & Services  2008 Enabling Clause & GATS Art. V 
Mauritius 30.11.07 Goods not notified 
Iran 01.10.06 Goods not notified 
SAFTA 01.01.06 Goods  2008 Enabling Clause 
Sri Lanka 12.06.05 Goods  2008 Enabling Clause 
ECO Signed 17.07.03 
not implemented* Goods  1992 Enabling Clause 
SAPTA 07.12.95 Goods  1997 Enabling Clause 
GSTP 19.04.89 Goods  1989 Enabling Clause 
PTN 11.02.73 Goods  1971 Enabling Clause 
CHINA 
ASEAN 01.07.07 Services  2008 GATS Art. V 
Chile 01.10.06 Goods  2007 GATT Art. XXIV 
Macao, China 01.01.04 Goods & Services  2003 GATT Art. XXIV & GATS Art. V 
New Zealand 01.10.08 Goods & Services not notified 
Hong Kong, China 01.01.04 Goods & Services  2003 GATT Art. XXIV & GATS Art. V 
ASEAN 01.07.03 Goods  2004 Enabling Clause 
Accession to APTA 01.01.02 G oods  2004 Enabling Clause 
Source: WTO Secretariat.  
 
*  According to Pakistan, this Agreement will become operational from 1 January 2009. 
 SAFTA: South Asian Free Trade Agreement.  
ECO: Economic Cooperation Organization. 
SAPTA: South Asian Preferential Trade Arrangement. GSTP:  Global System of Trade Preferences. 
PTN:  Protocol relating to Trade Nego tiations among deve loping countries. 
APTA: Asia Pacific Trade Agreement (Bangkok Agreement).  
  
 
  
 
  WT/REG237/1 
 Page 17 
 
 
  ANNEX I 
 
Indicators of trade liberalization under the Pakistan-China FTA  
 
1. A comparison between the scheduled elimination of tariffs applied to the Parties' mutual 
imports and the duty rates applied by them to MFN imports is shown in Tables A.1 (Pakistan) and A.2 
(China) below, by agricultural (WTO definition), non-agricultural and total products.  Applied MFN 
duty rates in 2007 serve as a comparison. 
2. Pakistan has a variable MFN tariff structure.  Its (unweighted) average MFN rate (2007) is 
14.5% on all goods, with a slightly higher average tariff applied to agricultural goods than to 
non-agricultural products.  5.8% of Paki stan's tariff lines are duty-free at  an MFN level.  On entry into 
force of the Agreement, China's exporters enjoye d a relative margin of preference of 9% on non-
agricultural products vis-à-vis  the prevailing average MFN tariff in 2007 and a relative margin of 
preference of 8.8% in agricultural goods.  By the end of the transition period in 2012, these margins of 
preference increase to 29.7% and 26.4%, respectivel y, while the share of duty-free lines increases to 
36.4%.  
 
Table A.1 
Pakistan: Indicators of MFN tariff rates a nd preferential rates for imports from China 
ALL PRODUCTS Agricultural products a Non-agricultural products 
Average applied 
tariff Average applied 
tariff Average applied 
tariff Origin of 
goods Year 
Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff 
lines (%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) 
MFN 2007 14.5 15.4 5.8 14.8 17.5 15.0 14.5 15.2 4.5 
China 2007 13.2 15.1 12.8 13.5 16.6 17.6 13.2 15.0 12.1 
 2008 12.5 14.4 13.3 12.9 16.2 19.4 12.4 14.2 12.4 
 2009 11.7 13.5 13.3 12.3 15.4 19.4 11.7 13.3 12.4 
 2010 11.0 17.4 36.4 11.7 17.2 30.5 11.0 17.5 37.3 
 2011 10.7 16.8 36.4 11.3 16.7 30.5 10.6 16.9 37.3 
 2012 10.2 16.1 36.4 10.9 16.1 30.5 10.2 16.2 37.3 
 
a WTO Definition. 
 
Source: WTO Secretariat estimates based on data provided by Pakistan. 
 
3. China has a variable MFN tariff structure.  It s (unweighted) average MFN rate (2007) is 9.8% 
on all goods, with a higher average tariff applied to agricultural goods than to non-agricultural products.  8.4% of China's tariff lines are duty-free at an MFN level.  On entry into force, Pakistan's 
exporters enjoyed a relative margin of pref erence of 20.2% on non-agricultural products vis-à-vis  the 
prevailing average MFN tariff in 2007, and a relative margin of preference of 12.4% in agricultural 
goods.  By the end of the transition period in 2012,  these margins of preference increase to 42.7% and 
22.2%, respectively, while the share of  duty-free tariff lines increases to 35.4%. 
Table A.2 
China: Indicators of MFN tariff rates and preferential rates for imports from Pakistan 
ALL PRODUCTS Agricultural products a Non-agricultural products 
Average applied 
tariff Average applied 
tariff Average applied 
tariff Origin of 
goods Year 
Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff 
lines (%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) 
MFN 2007 9.8 10.7 8.4 15.3 16.4 6.9 8.9 9.8 8.6 
Pakistan 2007 8.0 9.7 17.8 13.4 15.4 13.2 7.1 8.7 18.6 
 2008 7.6 9.3 18.5 13.1 15.1 13.6 6.7 8.3 19.4 
 2009 7.1 8.7 18.5 12.7 14.7 13.6 6.2 7.7 19.4 
Table A.2 (Cont'd)  WT/REG237/1 
Page 18  
 
  ALL PRODUCTS Agricultural products a Non-agricultural products 
Average applied 
tariff Average applied 
tariff Average applied 
tariff Origin of 
goods Year 
Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff 
lines (%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) 
 2010 6.7 10.3 35.4 12.4 15.9 22.0 5.7 9.2 37.7 
 2011 6.4 9.9 35.4 12.1 15.6 22.0 5.4 8.7 37.7 
 2012 6.1 9.4 35.4 11.9 15.2 22.0 5.1 8.2 37.7 
a  WTO Definition. 
 
Source: WTO Secretariat estimates based on data provided by China. 
 
4. Table A.3 shows the market access opportuniti es in China for Pakistan's top 25 exports, 
which in 2004-2006 accounted on average for 54.3% of  Pakistan's global exports.  The table shows at 
which year all HS 8-digit tariff lines corresponding to the product definition (i.e. applying to the 
6-digit HS code used to capture the volume of trade) will become duty-free in China. 
5. Pakistan's top 25 exports cover a total of 57 HS  8-digit tariff lines.  None of Pakistan's top 
25 exports already benefited from zero MFN duti es in China's market:  in 2007, 11 products 
(accounting for 29 tariff lines and 23.9% of Pakist an's average global exports) gain immediate 
duty-free access;  and two products are granted duty- free access in 2008.  Twelve products, including 
certain textiles and clothing articles, petroleum oils  and rice (the latter is Pakistan's top export 
product), are excluded from tariff liberalization.  Th e margin of preference granted to Pakistan by 
China under the Agreement varies from 4 to 20 percentage points. 
Table AI.3 – Market access opportunities und er the agreement for Pakistan's top 25 exports 
Access Conditions to China's market  
MFN (2007)  Pakistan's top export products in 2004-2006  Duty-free in  
HS number and description of the product  Share in 
global 
exports 
(%) Average 
MFN 
applied 
rate 
(%) Number of 
dutiable 
tariff lines  2007 2008 2010 Remain 
Dutiable 
 
100630 Semi-milled or wholly milled rice, 
whether or not polished or glazed 6.2 65.0 2    2 
630231 Other bed linen, of cotton 6.1 14.0 4 4    
271019 Other petroleum oils and oils obtained 
from bituminous minerals, crude  3.8 6.6 11   3 8 
630260 Toilet linen and kitchen linen, of terry 
towelling or similar terr y fabrics, of cotton 3.6 14.0 2 2    
610510 Men's or boys' shirts , knitted or crocheted, 
of cotton 3.3 16.0 1    1 
520512 Cotton yarn (other than sewing thread), 
measuring less than 714.29 decitex but not 
less than 232.56 decitex  3.3 5.0 1    1 
620342 Men's trousers, bib and brace overalls, 
breeches and shorts, of cotton 2.9 16.0 2    2 
520819 Woven fabrics of cotton, containing 85% 
or more by weight of cotton, other fabrics 2.8 10.0 1 1    
420310 Articles of apparel and clothing 
accessories, of leather or of composition leather 2.4 10.0 1 1    
521051 Woven fabrics of cotton, printed, plain 
weave 1.8 10.0 1 1    
570110 Carpets and other textile floor coverings, 
of wool or fine animal hair 1.6 14.0 1    1 
630210 Bed linen, knitted or cr ocheted 1.5 14.0 2 2    
520532 Multiple (folded) or cabled yarn, 
measuring per single yarn less than 714.29 
decitex but not less than 232.56 decitex 1.5 5.0 1    1 
521213 Other woven fabric s of cotton, weighing 
not more than 200 g/m2, dyed 1.5 10.0 1 1     WT/REG237/1 
 Page 19 
 
 
  Access Conditions to China's market  
MFN (2007)  Pakistan's top export products in 2004-2006  Duty-free in  
HS number and description of the product  Share in 
global 
exports 
(%) Average 
MFN 
applied 
rate 
(%) Number of 
dutiable 
tariff lines  2007 2008 2010 Remain 
Dutiable 
 
630232 Other bed linen, of man-made fibres 1.4 16.0 2  2   
610910 T-shirts, singlets a nd other vests, knitted 
or crocheted, of cotton 1.3 14.0 1    1 
950662 Balls, other than golf balls and table-tennis 
balls, inflatable 1.3 12.0 2 2    
630710 Floor-cloths, dish-cloths, dusters and 
similar cleaning cloths 1.2 14.0 1    1 
520522 Cotton yarn (other than sewing thread), 
measuring less than 714.29 decitex but not less than 232.56 decitex  1.1 5.0 1    1 
521031 Woven fabrics of cotton, dyed, plain 
weave 1.1 10.0 1 1    
901890 Other instruments and appliances used in 
dental sciences 1.0 4.0 9 9    
620462 Women's trousers, bib and brace overalls, 
breeches and shorts, of cotton 1.0 16.0 1    1 
420329 Other articles of apparel specially 
designed for use in sports 0.9 20.0 2  2   
520511 Cotton yarn (other than sewing thread), 
measuring 714.29 decitex or more (not 
exceeding 14 metric number) 0.9 5.0 1    1 
630239 Other bed linen, of other tex tile materials 0.8 14.0 5 5    
Total of above 54.3  57 29 4 3 21 
 
Source:  WTO estimates based on data provided by China and UNSD, Comtrade data. 
 
6. Like Table A.3, Table A.4 shows the market access opportunities in Paki stan for China's top 
25 exports (at the HS 6-digit level), which accounted  on average for 26.5% of China's exports to the 
world in 2004-06.  The table shows at which year all HS 8-digit tariff lines corresponding to the 
product definition (i.e. applying to the 6-digit HS code used to capture the volume of trade) will 
become duty-free in Pakistan.    7. China's top 25 exports cover a total of 78 HS 8-digit tariff lines.  Five of China's top 
25 exports (which account for 18 HS 8-digit lines and 6.9% of China's average global exports in the 
period 2004-06) already benefit from zero MFN duties in Pakistan's market;  none is subject to 
immediate duty-free access in 2007;  and three pr oducts are granted duty-free access in 2010.  
Seventeen of China's top 25 export products (whi ch account for 37 HS 8-digit lines and 16.6% of 
China's average global exports) are excluded from tariff liberalization under the Agreement.   
 
Table A.4 – Market access opportunities und er the agreement for China's top 25 exports 
Access Conditions to Pakistan's market  
MFN (2007)  China's top export products in 2004-2006  Number of tariff 
lines  Duty-free in  
HS number and description of the product  Share 
in 
global 
exports 
(%) Average 
MFN 
applied 
rate 
(%) Duty-
free Dutiable 2007 2010 Remain 
Dutiable 
 
847130 Portable automatic data processing 
machines, weighing not more than 10 kg 3.8 0.0 3     
851770 Facsimile machines and teleprinters, parts 2.2 10.0  1   1 
852990 Parts suitable for use solely or principally 
with the apparatus of headings 85.25 to 
85.28, other than aerials and aerial reflectors 2.0 15.0  3  1 2 
Table A.4 (Cont'd)WT/REG237/1 
Page 20  
 
  Access Conditions to Pakistan's market  
MFN (2007)  China's top export products in 2004-2006  Number of tariff 
lines  Duty-free in  
HS number and description of the product  Share 
in 
global 
exports 
(%) Average 
MFN 
applied 
rate 
(%) Duty-
free Dutiable 2007 2010 Remain 
Dutiable 
 
851762 Machines for the reception, conversion and 
transmission or regeneration of voice, images or other data 1.5 7.1  7 1 1 5 
901380 Liquid crystal devices, other devices, 
appliances and instruments 1.3 5.0  1  1  
847170 Automatic data processing machines and 
units thereof, storage units 1.2 0.0 7     
844399 Parts and accessories other than printing 
machinery used for printing by means of plates, cylinders and other printing 
components of heading 84.42 1.2 4.2 1 5 1 4  
851761 Base stations 1.1 20.0  1   1 
852190 Video recording or reproducing apparatus 
other than magnetic-tape type 1.0 20.0  2   2 
847330 Parts and accessories of the machines of 
heading 84.71 0.9 0.0 3     
852580 Television cameras, digital cameras and 
Video camera recorders 0.9 8.3  6  2 4 
950300 Tricycles, scooters, pedal cars and similar 
wheeled toys; dolls ca rriages; dolls; other 
toys; reduced-size ("scale") models and similar recreational models 0.9 15.0  5  1 4 
851712 Telephones for cellular networks or for 
other wireless networks 0.8 13.3 1 2   2 
852560 Transmission apparatus incorporating 
reception apparatus 0.8 7.5  8  2 6 
860900 Containers (including containers for the 
transport of fluids)  0.7 10.0  1   1 
853400 Printed circuits. 0.7 20.0  1   1 
850440 Other transformers, static converters 0.7 13.3  3   3 
844332 Letterpress printing machinery, other, 
capable of connecting to an automatic data 
processing machine or to a network 0.7 0.7 6 1   1 
844331 Machines which perform two or more of the 
functions of printing, copying or facsimile 
transmission 0.7 5.0  1   1 
640399 Footwear with outer soles of leather, and 
uppers which consist of leather straps across 
the instep and around the big toe other than 
those covering the ankle 0.6 25.0  1   1 
611030 Jerseys, pullovers, cardigans, of man-made 
fibres 0.6 25.0  1   1 
640299 Other footwear with outer soles and uppers 
of rubber or plastics, other than those 
covering the ankle 0.6 25.0  1   1 
852290 Parts and accessories suitable for use solely 
or principally with the apparatus of 
headings 85.19 to 85.21  0.5 5.0  1  1  
847160 Input or output units, whether or not 
containing storage units in the same housing 0.5 0.0 4     
852851 Video monitors, of a kind solely or 
principally used in an automatic data processing system of heading 84.71 0.5 0.0 1     
Total of above 26.5  26 52 2 13 37 
 
Source:  WTO estimates based on data provided by  Pakistan and UNSD, Comtrade data. 
 
__________