Pakistan notes growing economic ties with Russia

Islamabad has offered Moscow a barter agreement to shift away from Western currencies in settlements, a minister has said

Trade turnover between Russia and Pakistan has grown by over a third since last summer, as the two countries bolster economic ties, Pakistan’s minister for commerce, Syed Naveed Qamar, told RIA Novosti on Wednesday.

Bilateral trade from July 2022 to May 2023 surged by 34%, reaching $760.5 million, compared to $567.5 million in the same period the previous year, Qamar announced.

The official pointed to difficulties that Russia is experiencing in US dollar settlements due to sanctions, adding that barter trade between Moscow and Islamabad will reduce dependence on foreign currencies, including dollars and euros. He added that bilateral cooperation could be deeper; however, transactions using the SWIFT interbank messaging system create problems in trade with Russia.

“We have launched a barter agreement for companies in specific countries that face problems using conventional banking channels. For example, now it is Afghanistan, Iran and Russia,” Qamar explained.

READ MORE: Pakistan pays for Russian oil in yuan – Reuters

Economic cooperation between Russia and Pakistan has been bolstered over the past year as part of Moscow’s drive to diversify trade partners in response to Western sanctions.

Earlier this month, Islamabad received its first cargo of Russian oil paid for in yuan. The transaction signaled a shift in Pakistan’s dollar-dominated export payments policy. The cargo was delivered to Karachi port under a deal struck by Moscow and Islamabad in January. The first order under the deal was placed in April.

Find more stories on economy and finance in TROIB business