Lack of banking channels hinders Pak-Iran trade

Iran consul general says this is giving rise to massive indirect trade

KARACHI: There is huge potential to enhance bilateral trade and economic relations between Iran and Pakistan in diverse fields, however, there are many hurdles hindering smooth trade between the two nations, said Consul General of Iran Ahmad Mohammadi.

Speaking at the Karachi Chamber of Commerce and Industry (KCCI) on Wednesday, he termed lack of a proper banking channel the top-most hurdle.

He said that bilateral trade volume stood at $1.5 billion during 2018; however, actual trade volume was way higher than what official figures quoted because of massive indirect trade taking place between the two countries due to absence of a proper banking channel.

“We, at the Iranian Consulate, are very serious towards resolving all the issues so that bilateral trade and economic relations could reach their actual potential,” he added. The envoy further stated that one of the most important steps towards uplifting the existing level of bilateral trade was encouraging participation of businessmen in numerous exhibitions taking place either in Iran or Pakistan.

“Almost two-and-a-half years ago, we hosted Iran’s Solo Trade Exhibition in Karachi which was very successful and brought business communities of two neighbours closer to each other,” he said. “Such exhibitions must take place every now and then because they will surely pave way for much improved trade ties.” He expressed hope that trade volume between Iran and Pakistan would increase in the days to come. Speaking on the occasion, KCCI President Agha Shahab Khan said that negotiations on a Free Trade Agreement (FTA) with Iran were underway and both countries were keen to upgrade the Preferential Trade Agreement (PTA) to FTA.

He said that initial drafts, in this regard, have already been shared while the State Bank of Pakistan had also shared a draft of the MoU for a Banking Paying Arrangement (BPA) with Iran’s Bank Markazi. 

Published in The Express Tribune, October 24^th, 2019.

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