ISLAMABAD: Pakistan and Iran are all set to reach a barter trade deal by using the forums of Quetta Chamber of Commerce and Industry (QCCI) and Zahidan Chamber of Commerce and Industry (ZCCI), as State Bank of Pakistan (SBP) has refused to engage in formal trade with Iran due to US sanctions on the Islamic republic, well-informed sources told Business Recorder.

The pact is likely to be signed during the visit of Prime Minister's Advisor on Commerce and Investment, Abdul Razak Dawood who has reached Tehran on a two-day official visit to attend 9th Pakistan Iran Joint Trade Committee meeting scheduled for November 6-7, 2021.

Iranian Minister for Industry Reza Fatemi-Amin and Abdul Razak Dawood will jointly preside over the meeting during which issues related to trade cooperation will come under discussion, in addition to discussion on progress in decisions taken at the 8th meeting of JTC.

Both sides will discuss possibilities of FTA, cooperation in transportation sector, construction of border markets.

Dawood will also hold meetings with Iranian Ministers to discuss issue of bilateral interest.

The sources said it had been decided that a barter trade mechanism would be established between QCCI and ZCCI.

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Pakistan has shared a list of 33 items including rice, sesamum seeds, fresh or dried guavas, mangoes and mangosteens, meat of bovine animals, fresh or chilled, surgical goods, line animals (Mammals), bananas, woven fabrics or jute, plastic and articles (polymers or styrene), textile fabrics, dried leguminous vegetables, (peas, beans etc) vessels for the transport of goods, can molasses etc.

Iran has shared a list of 33 items of its interest: (i) gaseous hydrocarbons, liquefied (excluding natural gas); (ii) propane liquefied; (iii) crude petroleum oils: (iv) petroleum bitumen; (v) sacks and bags; (vi) fresh and dried dates; (vii) ceramic flags and paving & finishing ceramics; (viii) dried leguminous vegetables (chickpeas garbanzos); (ix) fresh and dried pistachios (both in shell and shelled); (x) bars and rods of iron or non-alloy steel, hot wafers; (xi) sweets biscuits and bread, cakes and pastry and waffles and wafers; (xii) chocolate and other food preparations containing coca; (xiii) fruit juices (grapes and vegetable fruits; (xiv) milk and cream, containing added sugar or other sweetening matter and; (xv) apples, pears and quinces, fresh; (xvi) grapes fresh or dried; (xvii) dries apricots, prunes, apples, peaches and pears etc.

The Barter Trade Mechanism (BTM) will work in following ways: (i) Pak exports to Iran will precede Iran exports to Pakistan; (ii) barter trade shall be restricted to land route via Taftan Border only; (iii) barter trade will be restricted to items agreed as per the Border Trade Agreement between Pakistan and Iran; (iv) there will be no monetary transaction under the barter trade arrangement.

Pakistan's importers will make payment to Pakistan exporters in lieu of goods exported by them in Pak Rupee and vice versa; (v) the value of goods exported under barter trade should not exceed a specific amount to be finalized during the meeting; (vi) on imports/exports of goods on either side, the party should submit documentary evidence such as Bill of Entry to the focal person in QCCI where the value exceeds the agreed amount in PKR; (vii) Customs authorities at Pak-lran Border will report import/export transactions of the value not exceeding agreed amount to the State Bank of Pakistan on monthly basis; (viii) export of goods from Iran to Pakistan against import of goods from Pakistan to Iran should be completed within a period of six months from the date of import; (ix) a copy of the contract for import and export with Iranian parties should also be submitted to QCCI and ZCCI; (x) QCCI will forward a monthly statement within 15 days from the close of the month; (xi) Periodic Review of the agreement will be carried out after mutual consultations; and (xii) each Party may terminate/rescind this agreement through a written communication addressed to the other Party, with a minimum notice of three months.

Copyright Business Recorder, 2021

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