By Mahnaz Abdi

Lack of banking channel main barrier for Iran-Pakistan trade

November 14, 2017

KARACHI- The value of trade between Iran and Pakistan stood at near $1.2 billion in the past Iranian calendar year (ended on March 20, 2017) increasing from $861 million in its previous year and the figure is planned to increase also in the current year.

While the two countries’ officials have set a target of $5 billion bilateral trade by 2021, achieving this goal faces some hurdles especially when it comes to trade between the businessmen.

A delegation of some Iranian businessmen from different sectors have recently visited Expo Pakistan 2017, which was held from November 9 to 12 at Karachi Expo Center, in a bid to find Pakistani partners and also explain their problems in the way of business with Pakistan for the Pakistani commerce officials during some meetings on the sidelines of the expo.

During the exhibition, the Tehran Times has conducted some interviews with a number of businesspeople from the both sides to take a comprehensive view about the barriers they are facing in the way of bilateral trade.

Most of them mentioned lack of banking channel as the main hurdle while there are also some other barriers such as those related to visa issuance.

Iranian delegates say that receiving visa from Pakistan’s embassy in Tehran has become more difficult recently and also duration of stay has been reduced when issuing the visas.

The following is text of the interviews with two of the businesspersons.

Providing easier condition to Iran’s benefit

Behjat Nasseri, an Iranian-Pakistani woman conducting exports and imports between the two countries for some 8-9 years, mentioned delay in customs clearance as the main barrier from the both sides although she said the problem is more with the Iranian side due to the more formalities and also because there are more holidays in Iran making more delay in the clearance process.

She said the reason that Iran is lagging behind the other countries in supplying the Pakistani needs is the absence of LC, and as the other countries can open LC they can export big consignments.

So, if the banking problem is solved many problems will be removed, she stressed.

“Iran and Pakistan are two neighbors working with each other since the old time. There are many cultural affinities between them even in the language and if we provide easier condition for trade it would be in our interest because we have many products to export to Pakistan”, she added.

Nasseri further said that development of Ian’s southeastern Chabahar Port in recent years has played some fruitful role in facilitation of trade between the two countries.

 Proper true channel required

Also, Anis Majeed, the chairman of Karachi Wholesale Grocers Association (KWGA) and also the chairman of Bombi’s Group based in Karachi, referred to banking problems as the main barrier saying: “As the major problem with Iran and Pakistan we don’t have the complete good business banking channel and that is a problem because we cannot establish LC and from there they cannot establish LC so most of the business is being done via Dubai or on the border side. So, we would like to have some banking channel.”

“If the banking channels are started and LCs are established we can sell some rice directly to Iran and we can buy something from Iran. Because it’s not the proper true channel, that is very difficult for the business in Pakistan”, he stated.

“So, you know on the border business, we do not prefer to do more business with borders only because we want to do business through proper channel”, he added.

“We have also problem with getting visas for there and we don’t have the direct airline”, Majeed further complained.

“We should have more relation with Iran and we should have direct airline and all the visa facilities, and also direct vessel to Iran because it’s the neighboring country and if we have a direct vessel to Iran that would be much cheaper and easier for everybody”, he added.

“We are the neighbor countries and all over the world the neighbors do most of the business because it is very cheaper and very easy to reach the cargo in few days. So, that is the most advantage for business between Iran and Pakistan. So, we should have more bilateral relations”, he concluded.

PHOTO: Iranian trade delegation headed by Pakistan’s Commercial Counselor in Iran Nazar Muhammad Ranjha (1st R) in Expo Pakistan 2017 

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