Pakistan has allowed barter trade with Russia, Iran, and Afghanistan for certain goods, the Ministry of Commerce said on Friday.
The Order issued by the ministry will be called the Business-to-Business (B2B) Barter Trade Mechanism, 2023, and allows for the export and import of several items.
The imports, allowed under the mechanism, among others also include fuel imports such as coal, crude oil, liquefied natural gas (LNG), and Liquefied petroleum gas (LPG). The ministry has issued a separate list of items that can be imported from the three countries.
The Order highlights that “barter trade” means the exchange of goods by way of import and export without the involvement of any currencies. The regulatory Collector having territorial jurisdiction will have the power to allow the export and import of goods against authorization, subject to the conditions stipulated under the Order.
The order also allows the export of 26 categories of items to the three countries. Some of the items that can be exported include dairy products, meat and fish, pharmaceuticals, finished leather and leather apparel, iron and steel, motorcycles and tractors, and sports goods.
Pakistan recently placed an order for a test cargo of Russian crude. There has been no official confirmation regarding the mode of payment but according to various media reports the payment for the Russian crude wasn’t made in US Dollars.
The decision to allow barter trade could potentially allow Pakistan to import petroleum products and LNG without the involvement of any currencies.