Pakistan and Russia have signed their first agreement on barter trade, following a large delegation of Pakistani government officials and businessmen to Moscow.

Pakistan-Russia Trade and Investment Forum kicked in Moscow, with over 70 Pakistani businessmen and 100 Russian companies taking part.

The forum will have a positive effect on bilateral relations between the two countries, stated Russian Deputy Trade and Investment Minister Alexey Gruzdev while welcoming the Pakistani delegates.

Islamabad wants to enhance its trade with Russia, Pakistani Federal Minister for Privatization & Communications Abdul Aleem Khan said, addressing the forum.

The two countries have long-standing diplomatic and commercial relations and Pakistan attaches great importance to its ties with Russia, Khan stated.

Two agriculture companies from Russia and Pakistan have signed first ever barter deals on the side-lines of the forum.

Russian firm Astarta-Agro Trading agreed to supply 20,000 tons of chickpeas in exchange for 20,000 tons of rice from Pakistan’s Meskay & Femtee Trading Company.

Under another contract, Astarta agreed to supply 15,000 tons of chickpeas and 10,000 tons of lentils for 15,000 tonnes of Pakistani mandarins and 10,000 toes of potatoes.

Islamabad is trying to improve its role as a transit hub for landlocked economies in Central Asia, and has a strong desire to connect with Russia through Central Asia for bilateral trade, Khalid Shikari, a former high-ranking diplomat in Pakistan's Foreign Service, told Sputnik India.

"The current volume of trade between the two countries does not reflect the true potential of Pakistan and Russia," Shikari said. "Although Pakistan’s bilateral trade with Russia reached an unprecedented $1 billion last year, there is potential for a much higher number."

He added that last year Pakistan received its first shipment of liquified petroleum gas from Russia at a discounted price, showing that trade between the two countries can be made possible even under the pressure of western sanctions.

"Pakistan’s major imports from Russia include wheat and muslin, crude oil, minerals and fertilizers, and other items such as pharmaceutical products, bituminous coal, synthetic rubber, sunflower seeds and petroleum gasses," Shikari said.

Russia's imports from Pakistan include leather apparel, textiles, ready-made garments, surgical, medical and dental instruments, rice, sports goods, Himalayan pink salt and beauty instruments.

"Despite the growing interest for trade between the two countries, there are payment issues due to Western sanctions on Russia, which Moscow aims to bypass by pursuing barter deals that take away the need for payment exchange," Shikari said, "reducing the impact of sanctions and embargoes."

In September, Russian Deputy Prime Minister Alexei Overchuk visited Islamabad where he offered Pakistan cooperation with the Eurasian Economic Union (EAEU), that includes five member states comprising Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan.

Overchuk and Pakistan's minister Ishaq Dar discussed plans to develop rail and road networks to improve trade routes between Pakistan and Russia. They also stressed the importance of enhancing regional infrastructure through the North-South Transport Corridor (NSTC) and linking it with China’s Belt and Road Initiative (BRI).

"The primary goal is to enhance trade, strengthen diplomatic ties, and develop infrastructure, particularly in the energy sector," Shikari said. "As Pakistan is enhancing its ties with Russia and China, influence of the West is diminishing in the South Asian region."

Agencies