ISLAMABAD: Pakistan has decided to carefully examine the impact of sanctions against Iran before the sale of a million tons of wheat (initial deal is only for 100,000 tons) under barter trade deal at $300 per ton, official sources told Business Recorder.

This decision was taken by the Economic Coordination Committee (ECC) of the Cabinet on August 7 this year, which was presided over by the Finance Minister Senator Dr Abdul Hafeez Shakih.

“Governor of State Bank of Pakistan (SBP) Yaseen Anwar has been directed to get feedback from the Ministry of Foreign Affairs on possible impact of UN sanctions on Iran on the proposed barter trade between the two countries,” the sources said, citing official documents.

According to sources, the ECC in its meeting on March 13 had constituted a committee headed by the then Minister for Water and Power( now Defence Minister) to explore the possibility of barter arrangements between Pakistan and Iran for export of one million tons of wheat.

In pursuance of that decision, a delegation led by Secretary National Food Security and Research visited Iran from April 22-24 this year and held meetings with Government Trading Company(GTC) of Iran to finalise barter trade arrangements.

Later, the Ministers for National Food Security and Research and Capital Administration and Development visited Iran from July 14-16 as special envoys of the President. They met with Iranian Ministers for Industry, Mining and Trade and Petroleum and finalised a deal for the sale from Pakistan Agricultural Storage and Services Corporation’s (Passco) stocks in exchange for urea fertilizer from Iran.

Subsequently, a team comprising the Secretary of the Ministry of National Food Security and Research, Shafqat Hussain Naghmi, Pakistan’s ambassador to Iran and the Managing Director of Passco held a meeting in Iran on August 4 this year with the head of GTC of Iran to finalise barter deal arrangement.

Pakistan team suggested a price of $349 per ton, while the Iranian side offered $300 per ton for the first 100,000 tons.

The Iranian side also argued that India was offering wheat at a much lower price. In April this year, the Iranian side had offered $275 per ton and desired a response by August 5.

The ECC was informed that due to time constraints, the Ministry of National Food Security and Research submitted a summary to the Prime Minister, seeking his approval for considering the Iranian offer.

The Prime Minister accorded his approval and directed that a summary be submitted to the ECC of the Cabinet. Subsequently, ex-post facto approval of the ECC of the Cabinet was solicited to the proposal for considering the Iranian offer.

“Some members of the ECC suggested that impact of the UN sanctions on Iran on the proposed barter trade need to be examined in consultation with the Ministry of Foreign Affairs with a view to avoiding any adverse impact for Pakistan,” the sources maintained.