Pakistan, Russia agree to strengthen energy cooperation, enhance energy trade,broaden energy infrastructure investment

Pakistan and Russia have agreed to strengthen energy cooperation, enhance energy trade and broaden energy infrastructure investment based on strategic and favorable commercial terms on Friday, January 20. 

They arrived at this understanding at the conclusion of the eighth session of the Pakistan-Russia Intergovernmental Commission on Trade, Economic, Scientific and Technical Cooperation (IGC) held in Islamabad. It was led by Nikolay Shulginov, Minister of Energy for the Russian Federation and Ayaz Sadiq, Pakistan’s Federal Minister for Economic Affairs. Senior level delegates, including ministers and officials from both sides, also attended the session. 

The two sides agreed on March 2023, as the timeline for crude oil export.

Working under the express guidance of Prime Minister Shahbaz Sharif, and President of the Russian Federation, Vladimir Putin, both sides took the opportunity to reaffirm their commitment to a strong and comprehensive economic relationship. They reiterated that such a relationship contributes to the economic well-being of the two countries, as well as the entire region.

Both sides proceeded from the discussions and decisions of the seventh IGC and carried the process forward, and explored additional avenues of cooperation.

Reading out a joint statement alongside the Russian Energy Minister, Sardar Ayaz Sadiq said the two sides agreed to further strengthen and enhance collaboration in the fields of trade and investment, energy, communication and transport, higher education, industry, railways, finance and banking sector, customs, agriculture, science and technology, and information technology.

They noted positive prospects for implementable and concrete projects in the above-mentioned sectors of the economy with a huge potential for the socio-economic development of both countries.

The commission agreed that the relevant ministries and departments from both sides will vigorously follow-up to exploit this potential for common prosperity.

They agreed too, that the oil and gas trade transaction will be structured in a way that has mutual economic benefit. The process will be completed within March 2023, said Sadiq.

Both sides have agreed to strengthen energy cooperation, enhance energy trade and broaden energy infrastructure investment based on strategic and favorable commercial terms. They have agreed to work on a “Comprehensive Plan for Energy Cooperation,” which will form the foundation for future work. This is to be finalised in 2023. 

Additionally, the two sides agreed that the Pakistan Stream Gas Pipeline Project should be considered in terms of a comprehensive infrastructure which is economically viable for sustainable gas infrastructure development ensuring affordable gas supplies.

The Russian side was invited toward potential projects of the federal and provincial governments of Pakistan, including in PPP mode and requested the Russian businessmen to explore these possibilities.

All pending issues related to the exchange of information on “certificates of origin of goods” with the use of electronic verification systems have been resolved. The plan is to endeavour to finalise the above-mentioned protocols by the end of May 2023.

The two sides agreed to nominate focal persons in order to enhance mutual cooperation and discuss issues concerning connectivity and logistics in Central and South Asia.

They also agreed to take necessary measures to increase bilateral cooperation in science, technology and higher education, especially academic linkages, collaborative and impactful research, training and development, and enhanced interest of Pakistani citizens in education in the Russian Federation.

Both parties have decided to promote regional integration and Eurasian connectivity. And also, to explore innovative ways of doing business, including through barter

Russia’s Energy Minister Nikolay Shulginov, who is visiting the country, also said that Pakistan will pay for energy purchases from Russia, when they start in late March, in currencies of friendly countries.

Pakistan’s Minister of State for Petroleum Musadik Malik while talking with the media revealed that Pakistan wants to import 35% of its total crude oil requirement from Russia. Currently, Russia does not have liquefied natural gas (LNG) for Pakistan, said Malik.

The following documents were also signed during the session (8th IGC):

  1. Agreement regarding Cooperation and mutual assistance in Custom matters between the Government of the Russian Federation & the Islamic Republic of Pakistan.
  2. Protocol on exchange of document and data on Customs value of goods transported between the Russian Federation and the Islamic Republic of Pakistan.

3. Working agreement on Airworthiness of Aeronautical products.

Ahmad Ahmadani
Ahmad Ahmadani
The author is a an investigative journalist at Profit. He can be reached at [email protected].

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