Deputy Minister for Industry, Mines and Trade of Iran, Abbas Ghobadi has said that efforts were under way to establish banking channel between Pakistan and Iran. Speaking at a meeting of Karachi Chamber of Commerce and Industry (KCCI) and later taking to newsmen on Thursday, he said Iran was interested that both Iran and Pakistan should conduct trade with each other in their local currency.
The Deputy Minister termed the recent visit of President Ahmadinejad to meet President Asif Ali Zardari as successful and result-oriented. Both the leaders have discussed import of wheat by Iran, power supply to Pakistan besides other issues. He said Iran would import wheat in its local currency from Pakistan and in return it could provide electricity to Pakistan.
He informed that as agreed between the Presidents of two countries, Pakistan would export wheat to Iran which would be value-added and its products would be exported, which would maintain the trade between the private sectors. The indigenous wheat produced in Iran was fulfilling the demands and the factories of Iran had the capacity to process 25 million tonnes of wheat. Export of other commodities and products are also under consideration.
Referring to banking channel, he said the establishment of banking channel would help boost two-way trades and opening letter of credit (LC). He said Iran was focusing on regional trade particularly with Pakistan and central Asian countries.
The Deputy Minister said Iran was maintaining barter trade with India and China, and expressed hope that through barter trade Iran and Pakistan could enhance trade substantially. He emphasised the need for enhancing commercial activities between the port of Iman Khomeni, Bunder Abbas and Karachi ports. He said Iran had relations with 160 countries particularly economic relations with EU, UK, Canada and Central Asian States.
To a question about US intention to stop import of oil from Iran, he said US President announced to stop import of oil from Iran in next six months while the President of Iran to stop oil supply to US from the next day of US announcement. Iranian companies had good business relations with their US counterparts and there was a negative propaganda by the media about Iran-US relations, he added. Leader of Businessmen Group Siraj Kassam Teli proposed that both governments should consider and allow the business communities of two countries to go together with the government to government negotiations and to achieve this object a committee might be formed.
He also appreciated the efforts of Iranian Consul General in Karachi for enhancing trade activities. KCCI President Mian Abrar Ahmad has asserted upon the dire need of establishing banking channels, port-to-port activities and customs clearance mechanism between Iran and Pakistan.
He appreciated that Pak-Iran trade during last half decade increased from 389 million dollars to 1.2 billion dollars, and emphasised to deepen the existing Preferential Trade Agreement to be followed by Free Trade Agreement. He highlighted the existing tremendous potential for bilateral trade and identified possibilities of joint ventures in value-added agricultural sector and engineering sector.
To enhance bilateral economic and commercial co-operation, he voiced for establishing banking channel as the business transactions between Iran and Pakistan was routed through Asian Clearing Union, which was more time-consuming than a normal letter of credit (LC), while opening a LC through Iran's sister companies in Dubai also adds to cost.