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                                        Volume. 12119

Pakistan to renew focus on barter trade with Iran
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The Pakistan government decided on Saturday to revive the process of barter trade with Iran, which got stuck last year, in an effort to clear outstanding payments for electricity purchases from Tehran.
 
The decision came ahead of a meeting of the Joint Economic Council, which is scheduled to meet this quarter. It will discuss all outstanding bilateral trade issues including Iran-Pakistan gas pipeline, payments for electricity bills and cooperation in the banking sector.
 
To review the progress, an inter-ministerial meeting was held in Islamabad on facilitating trade between the two countries, keeping in view the United Nations’ sanctions.
 
Pakistani Finance Minister Ishaq Dar underlined the need for removing impediments in the way of bilateral trade before holding the Joint Economic Council meeting. The two sides will discuss all outstanding issues.
 
Dar said there was a need to build confidence in a bid to overcome the hurdles standing in the way of barter trade and commodity exchanges, which would enable the two countries to benefit from their proximity.
 
The finance minister recalled that during Prime Minister Nawaz Sharif’s visit to Iran, both sides had reaffirmed their commitment that while remaining within the ambit of UN sanctions, mutual trade and cooperation would be stepped up with barter trade and a commodities exchange mechanism.
 
A new set of U.S. sanctions came into force in February last year designed to restrict buyers of Iranian oil from making payments in local currencies rather than dollar or euro. 
 
Pakistan is also experiencing problems in making payments for electricity import. Iran supplied electricity valued at $53 million until July last year but payments were outstanding as international sanctions barred financial transactions with Tehran.
 
Pakistan’s efforts to export wheat to Iran, aimed at paying outstanding bills for electricity import, were also frustrated after the state-owned Trading Company of Iran cancelled an export contract under a barter trade agreement. Tehran revoked the contract because of slow progress on the barter arrangement.
 
Pakistan had agreed to sell wheat at $300 per ton to cover the cost of electricity being supplied to the National Transmission and Dispatch Company (NTDC) by Iran’s Tavanir.
 
Officials said NTDC had already paid the rupee equivalent of $9 million to the Pakistan Agriculture Storage and Services Corporation as the cost of 30,000 tons of wheat, out of $53.21 million owed to Tavanir.
 
(Source: The Express Tribune)

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