The "Early Harvest Progra-mme" was signed by Malaysian Trade Minister Rafidah Aziz and Pakistan's Privatisation and Investment Minister Abdul Hafeez Shaikh as part of Prime Minister Shaukat Aziz's visit to Malaysia.

"Malaysia and Pakistan agreed to pursue an Early Harvest Programme aimed to deliver benefits to the private sector of both countries ahead of the FTA as well as to provide impetus for an early conclusion of the FTA negotiations," Malaysia's trade ministry said in a press release.

Under the Early Harvest Programme, which will be effective from next January, Pakistan and Malaysia will grant reduced tariffs on 125 and 114 export items respectively.

The initiative will expire upon implementation of the FTA, or March 31 2007, whichever is earlier, it said.

Among the Pakistani products affected are machinery, mechanical equipment, plastic products, chemical products, rubber and timber products. Malaysia's list of goods include textile and clothing, agricultural products and jewellery.

Malaysia and Pakistan will continue negotiations to conclude the FTA by mid-2006, the ministry said.

The two countries had decided to negotiate a bilateral FTA during a visit to Pakistan by Malaysian Prime Minister Abdullah Ahmad Badawi in February 2005.

In 2004, total trade between Malaysia and Pakistan amounted to 2,870.9 million ringgit (762 million dollars).

Among Malaysia's major exports to Pakistan are palm oil and palm oil products and telecommunications equipment.