TEHRAN (IRNA) -- Indonesian Ambassador to Tehran Basra Hassan Ad-din said here Monday that the Qeshm island possess suitable location and capabilities to play an important role in transit of goods from central Asian to Europe.

Hassan Ad-Din told IRNA that Iran's location on the north-south corridor is advantageous for transporting goods from Asian countries to Europe.

He said he would brief his government and Indonesian traders over the attractions of the Qeshm Free Trade Zone with the aim of expansion of bilateral trade exchange. He said the two countries enjoy cordial diplomatic ties, "but, their economic and trade relations, due to array of obstacles, have fallen short of its potentials."

An obstacle is lack of sea transportation between the two nations, Hassan ad-Din said adding the North-South corridor will help the problem.

He also referred to the activities of the joint economic commission's to boost mutual trade exchange.

To evaluate the needs of the two nations' markets a joint committee comprising both countries' traders and entrepreneurs could have a speedy identification of the needs of the two markets.

He also said obstacles on the way of increased tourists visiting the two countries should be removed.

In related economic and trade news between the two nations, Iran's Commerce Minister Mohammad Shariatmadari and his Indonesian counterpart Mrs. Adisai Bodharamik in November stressed expansion of trade between Tehran and Jakarta.

The Iranian commerce minister discussed economic reforms carried out in Iran in the recent years. "Iranian banks are ready for business dealings with Indonesian banks," he added.

Also, the Export Guarantee Fund of Iran (EGFI) has expressed readiness for signing an agreement with Indonesian state insurance company.

Shariatmadari said an agreement for instituting a system of preferential tariff between the two countries is an important step for forging closer ties.

Another provision should be to inaugurate an air-link between Tehran and Jakarta to facilitate transport of goods and tourists.

The Indonesian commerce minister said the new economic and trade laws in Iran have provided suitable grounds for export and imports of goods and services.

They also provide better incentives for Indonesian businesspersons and entrepreneurs to enter into trade deals with Iranian counterparts.