ISLAMABAD – Pakistan and Russia have finally agreed to settle a 4-decadeold trade dispute, with the latter agreeing to invest $8 billion.
During the ’80s, some companies in USSR were importing textile productsfrom Pakistan. For facilitating the trade process, USSR opened two bankaccounts in the National Bank of Pakistan (NBP).
The Economic Affairs Division (EAD) deposited funds in these bank accountsthrough the State Bank of Pakistan (SBP). After the collapse of the USSR,numerous exporters didn’t get paid. The Pakistani companies claimed to havepaid large sea freight fees for the unshipped goods.
The exporters and Pakistani companies had to move their dispute to SindhHigh Court (SHC). SHC issued a stay order which stopped NBP fromtransferring $104.93 million to Russian banks.
Since then, every effort to resolve the issue between the two countries wasin vain.
In November 2015, both countries initiated a dialogue at the 3rdPakistan-Russia Inter-Governmental Commission session. Both governmentsreached an agreement that Islamabad will return $93.5 million in 90 daysafter officially signing the agreement.
Chairman of Board of Investment negotiated a deal with the exporters inOctober 2016. However, the Pakistani companies never withdrew theirpetitions from the Sindh High Court. As a result, the agreement was neverofficially signed.
In 2017, the Pakistani companies reached an agreement with the governmentand withdrew their cases from court. This included Tabani Group, MercuryGroup, ABS Group, Fateh Industries/Fateh Sports and Fateh Jeans.
Read Top Stories
On October 4th, 2019, Sindh High Court dismissed the case as the involvedparties reached an out of court agreement, paving the way for the agreementto be officially signed.
Pakistan’s ambassador to Russia will sign the agreement on the behalf ofthe Pakistani government.
Under the agreement, Russia will get the pending $93.5 million within 90days, while exporters and companies will receive $23.8 million as agreed.
After this agreement, Russia will go ahead with its plan of investing $8billion in different energy projects and Pakistan Steel Mills. Russia wasunable to invest in Pakistan during the dispute since Russian laws prohibitinvestment in countries with pending disputes.
Via: *The Express Tribune*link
