• Wednesday, January 29, 2020

Pakistani banks refuse to handle transactions with Iran

Discussion in 'Pakistan Economy' started by igoogle, Jul 20, 2010.

  1. igoogle

    igoogle BANNED

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    Economic sanctions on Iran by the United States has also affected Pakistan’s exports as all major banks have refused to conduct transactions with the troubled nation, exporters said on Monday.

    Although there is no official ban on the transactions of Pakistani banks with Iran, banks are hesitant to incur the superpower’s wrath, they said. Several Pakistani exporters’ dues were withheld in Iran as no bank was ready to conduct transactions, they added.

    The head of a private bank on the condition of anonymity said that they were in no position to challenge this power structure. He agreed that a majority of Pakistani banks were not conducting transactions with Iran.

    One of the major trade routes with Iran is via sea to Bandar Abbas from the Pakistani ports, while the land route to Taftan in Iran is from the Chaman border in Balochistan.

    An exporter said that the land route remains unfeasible for exporters from Karachi. This route is also used as a means of smuggling. According to reports, Iran closed its Taftan border with Pakistan on Sunday amid threats of suicide attacks in its territories.

    Pakistan had been conducting trade with Iran via Dubai. After dollar transactions from Iran stopped under the sanctions, Dubai banks started transactions in euro, but now it is carried out in the UAE dirham, a source said.

    An exporter told The News that even Dubai was not opening letters of credit (LCs) with Iran for the last one month. “This is now a very critical situation.”

    According to the data of the Federal Bureau of Statistics (FBS), exports to Iran declined by 55 per cent to $116.79 million during the eight months from July 2009 to February 2010 against $259.70 million during the corresponding period last year.

    Kazim Khandawala, one of the leading basmati rice exporters, told The News that a majority of the banks in Pakistan stopped transactions with Iranian banks since one-and-a-half-year.

    “We had been doing our business via Dubai. If we state Bandar Abbas as our port of destination in the State Bank of Pakistan’s export form, banks refuse to handle the money.”

    During trade via Dubai, Khandawala said that they paid nearly four percent in commission to the agents as land routes were made illegal and goods were under-invoiced.

    Khandawala, who was a major basmati rice exporter to Iran with a volume of around 40 containers a month from 2002 till 2007, has almost lost his business due to transactional problems. “Now, I barely send two containers a month.”

    Due to the refusal of Pakistani banks to conduct transactions, Indian rice exporters sold their variety 1121 rice, which was purchased by Iranians in the absence of Pakistani basmati rice.

    Iran is a huge market where Pakistan could sell its entire production of basmati, he said. “Though India has fully captured Pakistan’s basmati market in Iran, Pakistani rice can still be sold there, as our rates are good and we have people-to-people contact,” he added.

    Pakistani banks refuse to handle transactions with Iran
     
  2. TopCat

    TopCat ELITE MEMBER

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    More problem for Iran if other nation follow suit..
    Bomb does not come easy... :no:
     
  3. AZADPAKISTAN2009

    AZADPAKISTAN2009 ELITE MEMBER

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    United Nation pending issue unlike some nations that don't follow resolutions we sometimes are respectful of decision

    But in principle we do not find there is any legal value to the Unilateral sanctions

    Look forward to Iranian celebration day
     
  4. into the wild

    into the wild BANNED

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    and all is because of amreeeka????

    pakistan should develop ties with energy rich country like iran, and to meet its growing energy needs and least of all amreeka should be a hurdle in it..

    it is so shameful as written in the article

    in all ways this amreeka is making pakistan a biggest loser all all respects, pakistan gain nothing and loses every thing with this WoT ally, seems more like a slave...period
     
    Last edited: Jul 20, 2010
  5. AZADPAKISTAN2009

    AZADPAKISTAN2009 ELITE MEMBER

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    Head of Iran Foreign Investment Company (IFIC) said that Egypt and Iran will create a joint bank in Tehran for the first time, Mehr News Agency reported.

    The new bank will be a branch of the Misr Iran Development Bank (MIDB).

    IFIC head Mehdi Razavi told Mehr News Agency that last year MIDB transferred funds worth $50 million to Iran.

    According to Razavi, it is planned to expand activity of the new bank created by the two countries.

    Iran and Egypt's diplomatic relations have been suspended since 1979.


    SCREW SANCTIONS
     
  6. into the wild

    into the wild BANNED

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    state bank of pakistan must be sued for their inability to conduct a transaction just for the fear of amreeka

    pakistan should find new ways, and to show this amreeka that progress waits and doesnt take directives from no one
     
  7. AZADPAKISTAN2009

    AZADPAKISTAN2009 ELITE MEMBER

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    Pakistan is examining US sanctions against Iran: FO

    Staff Report

    ISLAMABAD: Pakistan on Friday said it is examining the tough sanctions approved by the US Senate against Iran, with special focus on the proposed Pak-Iran gas pipeline project.

    “We are examining the tough US sanctions against Iran and will issue our policy in this regard soon,” Foreign Office spokesman Abdul Basit told Daily Times.

    Talking to journalists in Karachi, Iranian Ambassador Mashallah Shakeri said the sanctions placed on Iran by the US would not affect the Iran-Pakistan gas pipeline project, which was signed much before the fresh restrictions. Ruling out the pipeline being affected by the sanctions, he said other countries such as China, Turkey and the EU have signed several accords with Iran in the energy
     
  8. AZADPAKISTAN2009

    AZADPAKISTAN2009 ELITE MEMBER

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    Turkey's reposne

    A general view shows an Iranian parliamentary session held in Tehran to discuss drafting a bill on downgrading ties with the UN atomic watchdog. AFP photo
    The recently approved sanctions against Iran will not require Turkey to take any additional measures or institute any new arrangements, the Foreign Ministry has said following its initial assessment of the UN Security Council’s resolution.

    “Sanctions do not affect our energy cooperation with Iran at all. Turkey already does not have important operations with Iranian banking systems. So we do not need any measures to address that,” diplomatic sources told the Hürriyet Daily News & Economic Review on Thursday.
     
  9. Awesome

    Awesome RETIRED

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    This is not entirely true.

    All banks have always been cautious of dealing with Iranian banks since the other branches operating in the United States would be penalized if any sort of money laundering link is found.


    Any money transfer, LCs, LGs, coming in from the United States to Iran or vice versa are politely refused not because of fear of the US, but because US Legislation prevents it.

    TB Loyds a few years ago was fined for $115 Mn over money laundering issues.

    Most of the times money laundering happens without the knowledge of the bank, though. People play around with the cash.
     
  10. AZADPAKISTAN2009

    AZADPAKISTAN2009 ELITE MEMBER

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    Plain HARD cash in breif case still works :woot:
     
  11. Skies

    Skies SENIOR MEMBER

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    PK should not do this.
     
  12. rohailmalhi

    rohailmalhi FULL MEMBER

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    Yeah Plain Hard Cash or Bartar Trade using which we are already doing alot of trade with Iran.so i think paying money is not gonna be an issue.
     
  13. into the wild

    into the wild BANNED

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    payning millions in cash lol.....
     
  14. somebozo

    somebozo ELITE MEMBER

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    The banks are waiting for clear regulations and list of banned entities from government. Just like it happend with UAE. Banks are scared to inadvertly affect their european and american operations by transacting with one of the banned entity indirectly. There are only 44 entities of Iran which are banned to deal with under american sanctions. If trading with Iran was banned all together, Pakistan wouldn't persue its gas pipeline by shrugging off US concerns. On the flip side, Pakistans are the king of money laundering and soon they will invent a substitute. When there is a will there is a way.

    Iran polictics have turned into a "langra loola man". Once side it want to see itself as a Shia dominat power, other side it want to corner Saudi in the race of influencing smaller persian gulf states. It wants to closely emulate Pakistan's clouth in Muslim world and millitary might of India. End of the day, it has lot of direction to go and very little movement.

    Iran mullahs should understand that we did not get bomb off the shelf over night. It came as a result of silent diplomacy of immense sacrifice during Soviet-Afghan war. When Pakistan had few good soviet nukes aimed toward her. As well our responsible conduct with regional powers (china) powerful friends in middle east (UAE & Saudi) and good will of muslims across the world.
     
  15. AZADPAKISTAN2009

    AZADPAKISTAN2009 ELITE MEMBER

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    [​IMG]

    100 Million , the lose change is in the small bag tiny bag

    In a way its easier for Iran because now there is no money trail fro their purchases