ISLAMABAD: Banking restrictions are threatening to halt Iran’s exports to Pakistan, disrupting cross-border trade between the neighboring countries as Iranian exporters struggle to complete payment procedures despite an open land border.
Peyman Sanandaji, head of the Transportation Commission of the Tehran Chamber of Commerce, told Iranian media that banking-related obstacles had temporarily disrupted Iranian exports to Pakistan. He warned that shipments could grind to a halt if the financial barriers remain unresolved.
The disruption highlights how international sanctions, particularly U.S. restrictions on Iran’s banking system, continue to complicate trade and payments between the two countries.
According to Sanandaji, Pakistani importers must submit electronic import forms to their banks for goods arriving from Iran. However, restrictions affecting Iran’s banking system have made it increasingly difficult to complete the required procedures, disrupting the flow of Iranian goods into Pakistan.
The immediate problem is not a border closure but the difficulty of processing the banking documents and payments needed to move goods across the border.
Sanandaji said Iran’s exports to Pakistan could effectively stop if the financial hurdles are not addressed. He also rejected claims circulating in a purported letter that a border crossing had been closed, saying the shared land border remained open.
Meanwhile, Pakistani exports to Iran could continue, Sanandaji said, although shipments would depend on cooperation from Pakistani authorities and trading partners. This could leave Iranian exporters facing greater immediate pressure while Pakistani suppliers retain opportunities to serve the Iranian market.
Iran and Pakistan have repeatedly expressed interest in expanding bilateral trade, with estimates of their trade potential ranging from $10 billion to $13 billion.
However, actual trade has remained well below that level, with reported values varying from several hundred million dollars to a few billion dollars in recent years, depending on the period and measurement used.
Iran supplies Pakistan with oil, petroleum products, chemicals, steel and other goods. Pakistan exports rice, meat, agricultural products and other commodities to Iran. Despite the potential for stronger economic ties, banking restrictions, customs procedures, logistical bottlenecks and cross-border payment difficulties have continued to limit formal trade.
Unless the latest banking obstacles are resolved, Iranian exporters could face further disruption, adding pressure to an already underdeveloped trade relationship between the neighboring countries.
