Following two years of negotiations, the Pakistani company Divan Engine and Iran's Saipa have signed an agreement regarding the export of CKD kits/automobile parts, manufactured in Iran, for final assembly in Pakistan.

The cars involved are the Saipa 'Nasim' and 'Saba' passenger cars that are closely based on the Kia Pride. Nasim is the hatchback and Saba is the notchback.

In the past, Divan Engine imported Kia Pride kits directly from Korea, but Iranian kits will be replacing Korean ones. Volumes are unclear.

Saipa became a full range auto manufacturer after it merged with three other major companies, Zamy, Iran Kaveh and Pars Khodro in 1999 to hold a substantial market share in Iran. Saipa is effectively controlled by the Iranian government, which owns 48 percent.

Saipa began assembling Citroen cars in 1968. In recent years, the company has produced a number of models including the Kia Pride, Peugeot 405 and 206, Nissan Patrol and Mazda 323. Two years ago it added the Citroen Xantia.