Russia and Pakistan launch barter trade system to bypass western sanctions: Report

The first to benefit from this deal is Russia's Astarta-Agrotrading, which will send chickpeas and lentils to Pakistan in exchange for mandarins and rice from Pakistan's Meskay + Femtee Trading Company.

Russian companies have found a creative solution to bypass Western sanctions by setting up a barter trade system with Pakistan, swapping goods instead of cash to maintain economic exchanges, according to a report by The Moscow Times. This new trade arrangement, announced at the first Pakistan-Russia Trade and Investment Forum in Moscow, signals a shift in how businesses are navigating global payment challenges.

The first to benefit from this deal is Russia's Astarta-Agrotrading, which will send chickpeas and lentils to Pakistan in exchange for mandarins and rice from Pakistan's Meskay + Femtee Trading Company. Under the agreement, Russia will export 20,000 tons of chickpeas, while Pakistan will supply an equivalent amount of rice, the report added citing Russian state media outlet TASS. A second deal outlines a trade of 15,000 tons of chickpeas and 10,000 tons of lentils from Russia for 15,000 tons of mandarins and 10,000 tons of potatoes from Pakistan.

Nasir Hamid, Pakistan’s deputy commerce minister, explained that this barter system was born out of “difficulties with mutual payments,” a challenge largely driven by sanctions against Russia following its invasion of Ukraine. Barter trade offers a clever workaround, allowing companies to exchange goods directly, avoiding the need for bank transactions that are under close international scrutiny.

Russia has been exploring similar barter systems with other countries, including China, though progress has been slow. Talks of resuming barter trade in metals and agricultural products have been on the table, reflecting a shared interest in finding alternatives to dollar-based transactions, the report added.

Beyond barter, Russia and China are also working on a broader solution to evade sanctions with a BRICS Bridge payment system. Although this is still in the works, emerging markets are watching closely, eager for alternative ways to keep trade flowing despite geopolitical obstacles.