Commerce Secretary Zafar Mahmood said Islamabad would utilise the opportunity to grab the Iranian market. However, he said that no official word had been received from Tehran on the issue. - File photo

ISLAMABAD: Sanctions-hit Iran has been offering new trading agreements to countries in an effort to skirt around the restrictions but it may be reluctant to extend the same to Pakistan, according to sources.

“We are ready to export the 200,000 tons of rice that Iran needs but its tariff and non-tariff barriers and unwillingness to agree to a currency swap arrangement stand in the way,” the president of the Rice Exporters Association of Pakistan, Javed Islam Agha, said on Sunday.

Iran has signed a $10 billion oil deal with India under a currency swap arrangement to avoid the use of dollars. (Such an arrangement allows the trading partners to deal in their own currencies.)

During his visit to Iran in July last year, President Asif Ali Zardari had suggested that the two countries finalise a currency swap agreement to enhance bilateral trade. He made the offer again during the recent visit to Pakistan of President Mahmoud Ahmadinejad. But the Iranian president did not make any commitment on the matter.

Talking to Dawn, Iranian Embassy spokesman Majeed Khazaei said his government had welcomed the Pakistani proposal. “We are working on it so that it may be finalised,” he remarked.

He said Iran had already formalised similar agreements with a number of countries.

Sanctions imposed by the West on Iran have set its trading partners pondering over the possibility of default. But, according to Mr Agha, the Pakistani rice exporters are not worried.

He, however, urged the Iranian authorities to ease their import regime for grains. “They impose a tax of (equivalent of) Rs22 per kg of rice for registered importers and Rs27 for unregistered importers.”

The Iranian government should waive off this duty, Mr Agha said.

Rice constitutes Pakistan’s biggest export to Iran. And rice and bread dominate the diet of most Iranians. That’s why the Iranian government recently announced that it would import some two millions tons of wheat from Pakistan.

Pakistan has sufficient wheat, a trader said. The government has allowed the export of the commodity but due to the declining prices in the world market Pakistani wheat is not too competitive.

“The Iranian government’s decision on wheat will allow our authorities to sell the stock available for sale,” said the trader.

Commerce Secretary Zafar Mahmood said Islamabad would utilise the opportunity to grab the Iranian market. However, he said that no official word had been received from Tehran on the issue.

Mr Mahmood ruled out the possibility that wheat and rice would be exported to Iran through state-owned entities. The matter would be handled by the private sector, he added.

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

‘Source of terror’
Updated 29 Mar, 2024

‘Source of terror’

It is clear that going after militant groups inside Afghanistan unilaterally presents its own set of difficulties.
Chipping in
29 Mar, 2024

Chipping in

FEDERAL infrastructure development schemes are located in the provinces. Most such projects — for instance,...
Toxic emitters
29 Mar, 2024

Toxic emitters

IT is concerning to note that dozens of industries have been violating environmental laws in and around Islamabad....
Judiciary’s SOS
Updated 28 Mar, 2024

Judiciary’s SOS

The ball is now in CJP Isa’s court, and he will feel pressure to take action.
Data protection
28 Mar, 2024

Data protection

WHAT do we want? Data protection laws. When do we want them? Immediately. Without delay, if we are to prevent ...
Selling humans
28 Mar, 2024

Selling humans

HUMAN traders feed off economic distress; they peddle promises of a better life to the impoverished who, mired in...