The State Bank of Pakistan (SBP) will soon allow Pakistani banks to resume ties with Iranian counterparts, said Abid Qamar, the chief spokesman of SBP on Monday. He noted that SBP would soon issue instruction to banks regarding their relations with Iran which makes transactions with Iran possible, the News International quoted him as saying on Teusday.
Earlier in February, Pakistan lifted sanctions on Iran. Western sanctions on Iran adversely affected its economic relations with Pakistan. The bilateral trade volume fell to $431.76 million in 2010-11 from $1.32 billion in 2008-09 despite the fact that both countries have a preferential trade agreement. The business community sees economic benefits for both Iran and Pakistan in the post-sanctions regime.
The resumption of banking ties will enable local importers to open the letters of credit. Officials at the Trade Development Authority of Pakistan (TDAP) hoped that Pakistan’s exports to Iran will increase with the easing of the sanctions.
They said Iran is the world’s second top importer of rice and the biggest importer of Basmati rice. Iran was the major consumer of Pakistan’s aromatic rice as it consumed 65% of Pakistan’s Basmati rice exports.
“However, after tough economic sanctions, Pakistan lost this market to India,” said an official at TDAP.
