By Samia Khalid ISLAMABAD, Nov 09 (INP-WealthPK)- Pakistan's exports to China increased by approximately 70 percent to $888 million in the first quarter of the current fiscal year, up from $526 million in the corresponding period of 2020-21, according to the Ministry of Commerce. This is partly the outcome of the China-Pakistan Free Trade Agreement (CPFTA) second phase, which commenced last year and will last through 2024. If the momentum continues, a new record is expected in FY2021-22. CPFTA-II permits Pakistani producers and dealers to export 313 new items to China without paying any tariff. The characteristics of phase-II include increased market access for both countries, updated safety systems, an electronic data interchange system, and a balance of payment clause. Under the first free trade agreement negotiated between the two countries in 2006, Pakistan already has zero tariff on 724 items sold to China. And now in phase-II, Pakistan has been allowed to export more than 1,000 items to China duty-free. Agriculture, leather, confectionery goods, and biscuits are among the industries that would benefit from the new facility. Pakistan and China reached an agreement in 2019 to use CNY in their $15 billion bilateral commerce to eliminate the dollar strain. As a result, bilateral trade increased to $15.6 billion in FY2018-19, up from $2.2 billion in FY2004-05. Business groups in Pakistan have largely praised the second phase as it incorporated safeguard systems that could better protect the domestic industries of both countries.  It is expected to l significantly boost Pakistan's commercial access to China. In the second phase, Pakistan has a competitive advantage in over 80 percent of the product categories, including machinery, mechanical appliances, plastics, steel, and iron. However, owing to high tariffs on certain commodities, Pakistan will not be competitive in the second phase on 12 percent of product categories, including cotton yarn, man-made fibre, clothing, vegetables, oils, processed food, and fruits. Moreover, the 401 high-priority product categories, including varied culinary preparations, cotton, textiles, plastics, automotive components, and footwear, would have more opportunities to increase their exports to China. The monthly exports of Pakistan have exceeded $2 billion for seven months in a row for the first time since 2011. Particularly, seafood, petroleum, dried fruits, spices, minerals, woven fabric, knitted clothing, sports items, cutlery, and dates saw an increase in exports, according to the Ministry of Commerce. However, due to increased domestic demand, imports have outpaced exports, resulting in a huge trade deficit. Pakistan has to raise private investment and export in order to maintain a sound economic development.