Special report: The future of Pakistan-Iran relations

Published: February 15, 2016

Pakistan may not be able to receive gas from Iran even after most sanctions on the latter have been lifted, because it seems that the United States is keen to restrict Russia’s access to the European market.

Influential British daily The Guardian had reported in August 2013: “[Syrian President Bashar al] Assad refused to sign a proposed agreement with Qatar that would run a pipeline from the latter’s North field, contiguous with Iran’s South Pars field, through Saudi Arabia, Jordan, Syria and on to Turkey, with a view to supply European markets — albeit crucially bypassing Russia.”

Read the full story here


Will Iran emerge as Pakistan’s major trading partner after the lifting of international sanctions?

Perhaps, it will. But as the old English saying goes, there’s many a slip ‘twixt the cup and the lip.

In an ideal world, the removal of international sanctions from a resource-rich neighbouring country should result in a sudden spike in the volume of bilateral trade. But international trade depends on financing from banks on both sides of the border. And in the short term, at least, Pakistani banks are expected to remain wary about doing business in Iran despite the lifting of many international sanctions.

Read the full story here


Though the United States and other global powers have lifted most of the sanctions from Iran, the fate of oil trade between Pakistan and the neighbouring Islamic republic is still uncertain.

According to officials, it will become clear whether Pakistan will be able to resume oil imports when banking channels are opened.

Earlier, two refineries – Pakistan Refinery Limited (PRL) and Bosicor – had been importing crude oil from Iran until 2010 and later purchases came to a halt as banks refused to open letters of credit after the imposition of sanctions on Tehran.

Read the full story here


With the dismantling of most sanctions on Iran, the Pakistan-Iran Joint Border Commission, in its 19th meeting in Quetta, vowed that it would now give legal cover to all trade between the two neighbours.

The decision may give a welcome boost to Pakistan’s economy that is expected to save at least Rs10 billion annually due to decrease in oil smuggling.

Talking to The Express Tribune, Balochistan Customs Collector Saeed Khan Jadoon said diesel was being smuggled through the Makran division, especially the Panjgur, Kech and Gwadar routes. “We run short of manpower, so we can’t effectively control smuggling,” he said.

Read the full story here


Desperate to take the much-awaited step towards reviving trade relations, Pakistan is mulling enforcing its five-year bilateral trade roadmap, already envisaged with an ambitious target of $5 billion, up from the present $270 million.

Unlike the past, Pakistan now wants to move away from certain commodities and wants to expand and diversify its exports.

The key potential trade areas Pakistan is eyeing are rice, horticulture, sports goods, surgical equipment, information technology, textile goods and construction material.

Read the full story here

Facebook Conversations

Reader Comments (8)

  • pk007
    Feb 15, 2016 - 6:48PM

    We have deep historical and cultural ties with Iran and best of all its our neighbour. Lets move on to economic and strategic partnership now. Arabs obviously will be disappointed but we have to start looking at our interests as we are an independent nation. With oil prices and rising war conflicts their future looks bleak. Recommend

  • roadkashehzada
    Feb 15, 2016 - 7:52PM

    we need to get out mindset of exporting kinnoo and rice to every country in the world.
    if we dont focus on new industry to export, iran will pass pakistan like a bullet. where are pakistani software houses? PITB? Hino? Nissan gandhara? Ghazi Tractors?Recommend

  • siliconhippy
    Feb 15, 2016 - 10:31PM


    At least there are cars and tractors being produced in Pakistan despite low efficiencies.

    But Punjab IT Board like bureaucrats are just good at writing big media articles.

    Now where is their performance evaluation report from neutral parties? How many profitable ventures has PITB produced in last 5 years? How about actual eCItizens served?Recommend

  • buba
    Feb 15, 2016 - 11:41PM

    All the blather about USA trade sanctions tends to ignore the obvious – Pakistan and Iran have NEVER had significant trade and Iran has been known to cutoff borders/trade on several occasions usually over Shia massacres in Pakistan. The IP was a political gimmick put together govt’s which were under pressure to demonstrate any positive movement – both knowing that neither had the financial or political clout to implement the proposal. If Pakistan had the money it could implement the IP tomorrow – it doesn’t – and that has been the issue since Day 1.
    Further – anytime the subject of trade comes up nobody ever seems to ask whether Pakistan actually makes anything that the other country really needs. Does Iran have a desperate need for textiles or food – nope. Like it or not the major export items that Pakistan specializes in are readily available anywhere and likely never subject to sanctions to begin with.Recommend

  • Feb 16, 2016 - 2:51AM

    We are searching free trade with others will we cannot sign free trade with our neighbour and Muslim brothers. that much weak and venerable we are or in simple term we still under rules not an independent nation.Recommend

  • Azam hasan mirza
    Feb 16, 2016 - 4:40AM

    The Shariffs and for that matter zardari are deeply suspicious of Shia Iran to the extent of paranoia created by their masters Saudi Arabia . It’s just an excuse of ‘American sanctions’ etc…
    The IP pipeline would be a breath of fresh air and reduce dependence on imports from neighbouring Arab states where prices are high! Who wAnts container loads of gas imports parked in Karachi?
    The impotent conceited Shariffs bow to the Anericans and Sauds, so the IP pipeline is just a pipe dream’!
    Our populace will continue to suffer shortages and load shedding for generations till someone with a different mindset and ideas comes along possibly in the form of Imran Khan.Recommend

  • Shane
    Feb 16, 2016 - 4:46AM

    The only problem which could rise up is due to Pakistan support of Saudi Arabia
    Regardless of if any import/export between two countries is really essential or not, there are still some businesses on both sides are trading with each other and making money even low and more over historical relation and similar culture and more over common generation between Iran and Pakistan is another fact that makes these two countries closer.
    Political decisions always ruin people relations. Shia/Suni discussions are all made up during history and empowered by western enemies in Britain and west. funny conflicts which has become so serious now to force brothers killing each other and nasty political/religious characters to abuse it for their dominant and existence on top of the government and also prove their stupidity about life.
    What ever happens between governments on both countries that obviously are not the real people elected choice, must not break the common blood and culture and brotherhood between 2 countries.Recommend

  • Khanra
    Feb 17, 2016 - 2:39PM

    “The IP was a political gimmick put together govt’s which were under pressure to demonstrate any positive movement”

    Are you kidding? The Iranians built their part of the pipeline, so it doesnt sound like a gimmick. Secondly, you allege that Iran has a habit of shutting down its borders with Pakistan over Shia massacres – can you point to a single instance when this occurred?

    “Does Iran have a desperate need for textiles or food – nope”

    Is all that Pakistan produces textiles and foods? Firstly, the Iranians actually do import basmati rice, and secondly, the point of trade is to develop industries. If Iran needs pharmaceuticals and it turns out that Pakistan has a decent pharma industry, then trade with Iran might benefit our pharma industry and allow for expansion. This is how trade works. Recommend

More in Business