Iran and Iraq traded 25.93 million tons of goods worth $8.64 billion since Ebrahim Raisi took office as Iran’s president on August 23, 2021, until June 21, 2022, says Rouhollah Latifi, spokesman of the Islamic Republic of Iran Customs Administration.
He made the statement on the occasion of Iraqi Prime Minister Mustafa Al-Kadhimi’s visit to Iran.
Leading a strong political and economic delegation from the neighboring country, Al-Kadhimi was officially welcomed by President Raisi in Tehran on Sunday.
According to the Associated Press, the visit is aimed at reactivating Baghdad-mediated talks between Saudi Arabia and Iran.
“Al-Kadhimi flew to Tehran from Iran's regional rival Saudi Arabia, where he held meetings with Saudi officials in the port city of Jeddah,” AP reported.
“Although the leaders made no mention of the Sunni powerhouse during their joint press conference in Tehran, it was clear that Al-Kadhimi had come to Tehran with messages from the kingdom in a bid to resume suspended political talks between the adversaries that have been held secretly in Baghdad.”
Customs data indicate that Iran’s exports to Iraq reached 23.52 million tons worth $7.58 billion during the 10-month period.
In return, Iran imported 2.42 million tons worth $1.06 billion, IRNA reported.
“Historical, cultural and religious commonalities between the two nations of Iran and Iraq and the development of political and economic relations between the two countries have led to Iran's non-oil exports increasing from $145 million in the fiscal 2001-02 to $9 billion in the fiscal 2019-2020. And again, last year’s [2021-22] exports hit 30 million tons worth $8.92 billion. In recent years, Iraq has become the second-largest export destination of Iranian goods in the world and the top destination among Iran's neighbors,” Latifi said.
He explained that Iran registered its first leap in exports to Iraq in the fiscal 2005-06 with $1.22 billion worth of shipments, which reached $2.76 billion in the following years.
“The second leap was in the fiscal 2009-10 with $4.56 billion of exports. The third leap was registered in the fiscal 2012-13 with $6.34 billion and the last leap was in the fiscal 2018-19 with $8.99 billion,” he said.
“Iran’s imports from Iraq, which mostly included essential goods, reached a record high of 2.7 million tons of goods worth $1.2 billion in the last Iranian year [March 2021-22].”
Iran's total imports during 2019-20 stood at 1.31 million tons worth $1.33 billion.
In other words, the fiscal 2021-22 imports were more than the volume registered during the two decades.
Agricultural and food products, construction materials, petroleum products, electronics, medical equipment and medicine, automobiles and spare parts, clothing, bags, shoes, iron products and nuts were the main goods exported from Iran to Iraq.
Essential goods such as wheat, barley, oil, corn, soybean, rubber, paper, and cereals along with machinery, scrap metal, home appliances, electronic equipment and measuring devices were among the most important goods imported from Iraq last year.
Kermanshah in western Iran shares around 371 kilometers of common borders with Iraq and the Kurdistan Region.
The province accounts for around half of Iran’s annual non-oil exports to Iraq.
Iraqi Business Delegation in Ilam Province
A 21-strong Iraqi business delegation from Diyala Governorate arrived in Iran’s Ilam Province on Sunday for a two-day stay, according to the chairman of Ilam’s Chamber of Commerce, Industries, Mines and Agriculture.
“The visiting mission was made up of the head and members of the board of directors of Diyala Chamber of Commerce, industrialists and businesspeople from the central-eastern Iraqi province who met with their Iranian counterparts as well as public sector officials,” Shaban Foroutan was also quoted as saying by IRNA.
The official noted that the main objective pursued by the two sides in the two-day meetings was to survey ways of expanding economic and trade cooperation in the new border market of North Helaleh, which is located in the region bordering Ilam and Diyala provinces.
“Ilam has great potential and capabilities in industrial, commercial and business fields. Last year [March 2021-22], a total of $1.16 billion worth of commodities were exported from the province to different Iraqi cities,” Foroutan said.
Agreement in Tourism Sector
The two countries signed an agreement on Monday for boosting tourism between the two neighboring countries.
Iranian Cultural Heritage, Handicrafts and Tourism Minister Ezzatollah Zarghami and his Iraqi counterpart, Hassan Nazim, signed the memorandum of understanding in Tehran. The agreement specifically mentioned joint projects on religious tourism following the easing of Covid-19 restrictions, such as facilitating visas, building hotels and investment in the tourism sector, IRNA reported.
Iraqis and Iranians frequently visit one another’s countries for religious reasons. There are numerous sites holy to Shia Muslims in both countries, including the Imam Hussein (PBUH) shrine in Karbala, Iraq, and the holy city of Mashhad, Iran.
As Al-Monitor reported, tourist visits are increasing in Iraq, climbing by 145% last year.
Iraqi Minister of Culture Hassan Nazim said on April 18 that officials from the ministry met with a delegation from Iran for talks on easing procedures for tourists at the countries’ land borders.
Nazim said the Iranian delegation asked for Iraq to make changes that would allow for easier crossings for tourists, who have at times been unable to travel to the country because of the difficulties in crossing the border, Kurdish media network NRT reported.
He said Iraq has decided to ease the routine and reduce taxes, calling on Iran to do the same for Iraqi tourists to the country.
The Iranian delegation said in return for Baghdad improving travel procedures, Tehran would limit the number of Iranians entering Iraq.
Rail Connection
Iran and Iraq have agreed to build the Basra-Shalamcheh railroad for connecting the two countries with Iran’s Minister of Roads and Urban Development Rostam Qasemi signing an agreement with his Iraqi counterparts in this regard.
The Islamic Republic of Iran Railways and Iraqi Republic Railways plan to establish a joint venture to complete the project within two months, IRIB News reported.
The project would connect Basra in southern Iraq to Shalamcheh in western Iran over a distance of 30 kilometers (18 miles). The railroad would be strategically important for Iran, linking the country to the Mediterranean Sea via Iraq and Syria’s railroads.
According to Al-Monitor, though, this is not the first time Iraqi and Iranian officials have promised to build the railroad.
The Islamic Republic of Iran Railways had revealed details of a plan to connect Basra with Shalamcheh in 2018. Al-Kadhimi and then-Iranian president Hassan Rouhani also pledged to move forward with the project last year.
Iraq’s Transportation Minister Hussein al-Shibli signed the agreement for the Iraqi side. The delegations also agreed to double the number of direct flights between their countries, according to Tasnim News Agency.
Iran and Iraq have close political and economic relations.
The 32-kilometer-long railroad will be funded by Iran's Mostazafan Foundation.
Back in May, former deputy minister of roads and urban development, Mahmoud Ghaffari, said an investment of up to €100 million are required to complete the project.
The Iraqi side failed to build the railroad from Shalamcheh to Basra due to economic problems and a shortage of funds.
The launch of the railroad will boost Iran's exports to Iraq and from this route to West Asian and North African countries.
In order to complete the Shalamcheh-Basra Railroad, the 17-kilometer Khorramshahr-Shalamcheh Railroad was completed in 2011 to connect Iranian railroads to the Iraqi city of Basra.
The project is aimed at facilitating the travel of Iranian pilgrims, especially during the annual Arbaeen pilgrimage and travelers could use the rail link from Iran via Basra to Karbala and other holy cities of Iraq.
While Iraqi passenger and freight trains are using the rail link of Basra to Karbala, Iranian pilgrims have been travelling by train from Tehran to Shalamcheh and from there after a 32-km trip by bus to Basra and depart from Basra to Karbala by Iraqi train.
According to Al-Monitor, the railroad is part of Syria’s reconstruction deal … promoting religious tourism among Iran, Iraq and Syria.
Syrian opposition parties, however, have rejected the railroad, believing it will entrench Iranian influence and help provide the logistic services necessary for its presence in Iraq and Syria, it claimed.
Former president, Hassan Rouhani, said the Shalamcheh-Basra railroad would connect Iran to Iraq, Syria and the Mediterranean, causing a fundamental change in the region.
"Iran's Khorramshahr, Abadan and Shalamcheh are located in a very important strategic area," he was quoted as saying by Mehr News Agency.
"Due to the agreement made with the Iraqi government on connecting Shalamcheh to Basra, we will be able to witness a fundamental change in this region. This will be a very big change and Iran's railroad will be connected to Iraq and Syria, and in fact to the Mediterranean, which is very important," he said.
