Banks reluctant to facilitate barter trade, Senate panel told

The Senate Standing Committee on Commerce was informed on Wednesday that Pakistani banks were hesitant about issuance of financial instruments for doing trade with Afghanistan, Iran, and Russia. Commerce Secretary Sauleh Farouqi while briefing the committee, headed by Zeeshan Khanzada, said that this reluctance on part of local banks had led to start of barter trade with these countries. Mr Farouqi said the objective of barter trade is to promote trade by marginalising the role of financial institutions and shifting of informal trade to formal channels. Calling it an initiative of the ministry of commerce and customs, he said that SRO 643 had notified the mechanism for barter trade. However, he stated, barter trade with these countries would be kept on a limited scale, adding that the Trade Development Authority of Pakistan would be taken on board on the matter. He informed the meeting that there would be no change in the mechanism of taxes and duties for barter trade, adding that talks had already started between Afghan and Pakistani customs officials on the list of items for barter trade.