Indonesia, Pakistan Target CEPA by 2027 to Deepen Strategic Economic Ties
Key Takeaways
|
KARACHI, Investortrust.id — Indonesia and Pakistan agree to upgrade the Indonesia–Pakistan Preferential Trade Agreement into a Comprehensive Economic Partnership Agreement by 2027 on Friday, Jan 9, 2026 in Karachi, Pakistan, as both countries seek to broaden strategic economic cooperation and strengthen long-term trade ties. The move is expected to expand collaboration beyond goods trade into services, investment, and regional economic integration.
The commitment was reaffirmed during a bilateral meeting between Indonesian Deputy Trade Minister Dyah Roro Esti Widya Putri and Pakistan’s Commerce Minister Jam Kamal Khan. The talks followed President Prabowo Subianto’s visit to Islamabad in December 2025, which resulted in a joint statement to elevate bilateral economic relations.
“Indonesia is pushing for an expansion of cooperation through a CEPA,” Roro said. “We propose that negotiations continue in early 2026 so potential sectors in both countries can be identified immediately.”
She said the agreement would create a broader and more structured framework for cooperation. “CEPA will open wider opportunities, not only in trade in goods, but also in services and investment,” Roro said.
Indonesia also proposed expanding cooperation in the services sector, particularly healthcare. Roro said the sector was strategically important and could be developed through cooperation in medical personnel such as doctors and nurses, which she said would complement the needs of both countries.
The bilateral talks also covered regional trade cooperation, including the Developing Eight Preferential Trade Agreement. Indonesia welcomed Pakistan’s implementation of the D-8 PTA starting Jan 1, 2025 and supported Pakistan’s appointment as D-8 secretary general in 2026.
“Indonesia believes that full implementation of the D-8 PTA by all member countries will strengthen economic integration and promote mutually beneficial trade,” Roro said. “Going forward, Indonesia will prioritize transforming the D-8 PTA into a CEPA during its D-8 leadership in 2026–2027, and we hope for Pakistan’s support in this effort.”
Palm oil remained a central pillar of the discussions, with Pakistan ranking as Indonesia’s third-largest palm oil export destination after China and India. Indonesia’s palm oil exports to Pakistan reached $2.77 billion in 2024, reflecting Pakistan’s role as a long-term strategic partner.
Roro said Indonesia’s domestic biodiesel policy would not disrupt exports. “Our biodiesel mandate, including preparations toward B50 in 2026 as part of energy security, will not interfere with palm oil exports,” she said, adding that Indonesia carefully managed production, productivity, and stock levels to ensure stable export supply.
Pakistan’s Commerce Minister Jam Kamal Khan said the two countries’ economies were highly complementary. “Bilateral relations between Pakistan and Indonesia are expected to become stronger, more structured, and more mutually beneficial,” he said.
He added that Pakistan was eager to expand cooperation in healthcare and industrial technology, while also seeking greater access for its agricultural products to the Indonesian market. “This year, Pakistan plans to hold a single showcase exhibition in Indonesia featuring our strategic export products, and we hope for Indonesia’s full support to ensure its success,” Jam Kamal said.
Trade ministry data showed Pakistan as Indonesia’s 14th-largest export destination and 36th-largest import source in 2024. Total bilateral trade reached $3.6 billion in 2025, with Indonesia posting a surplus of about $3.3 billion.