Key Points:

• The total trade value between Iran and Pakistan is 392.08 million dollars, with 22.86 million dollars worth of Pakistani exports.
• Pakistan’s export portfolio viz Iran is relatively limited as only rice makes up 63 per cent of Pakistan’s total exports to its western neighbour.
• Even with sanctions, Iran in 2021 was the third largest producer of dry natural gas, increasing its natural gas output by 60 per cent between 2011 and 2021, approximately 8.8 trillion cubic feet per year.
• If the Iran-Pakistan pipeline had been completed and operational on time, Pakistan would have had access to a cheaper natural gas source rather than having to set up the infrastructure and then import LNG.
• Currently, Pakistan does not undertake many imports from Iran in the energy sector, the main being around 100 megawatts of electricity for Gwadar, which up till 2010 used to be 35 megawatts.
• Both countries should formalise the long-delayed FTA, while Pakistan should diversify its export basket in order to overcome the trade imbalance.