Pak exporters asked to manage their banking affairs through Bank of Russia

Ambassador of Russian Federation Mr Alexey Dedov on Friday said the diplomatic relations between Russia and Pakistan were deep rooted since 1948. Addressing the business community at the Faisalabad Chamber of Commerce and Industry (FCCI) here Friday, he said: "We have been contributing in a big way in development of Pakistan. Pakistan Steel Mill and many energy related projects were established with the Russian cooperation."

He said that around 200 joint ventures had so far been completed in Pakistan in different sectors of the country, including telecom, engineering and construction.

Responding to a question, he said:"We have to perform within a given framework and try to provide conducive climate to promote trade relations." He said:" Russian delegations generally visited Islamabad, Karachi and Lahore, but we will try to arrange their visit to Faisalabad." He also indicated that the business community of the two countries should participate in intentional trade fairs and exhibitions to culti- vate direct relations with each other. Russia was starting work on offshore gas pipeline in Pakistan which would help resolve the energy problems of upcountry areas, he said.

Regarding banking channels, he said:" We are trying to streamline our banking system. However, Pakistani exporters could manage their banking affairs through State Bank of Russia to avoid any mishap." He added that a branch of National Bank of Pakistan has been working in Masco since January 2018. He asked the businessmen to point out specific custom related problems so that these could be resolved at appropriate forum. Regarding visa, he said that generally the embassy issued single or double entry visa while multiple visa was issued only on the recommendation of Russian partner of the applicant.

Earlier, in his address of welcome, President FCCI Syed Zia Alumdar Hussain said that bilateral trade between the two countries stood at 402.78 million dollars in 2017. Pakistan made 144.71 million dollar exports while imports from Russian Federation were 258.01 million dollars thus balance of trade remained in favour of Russian Federation.

He invited the Russian investors to come here and exploit the vast untapped potential of Punjab particularly in Faisalabad. He also stressed the need for direct links between the business communities of the two countries and holding of single country exhibition on reciprocal basis to increase the trade volume. A documentary about FCCI and Faisalabad was also screened while President FCCI Syed Zia Alumdar Hussain presented FCCI shield to Ambassador Mr. Alexey Dedov.

Mr Youri Kozlov Trade Representative of Russian Federation, Miss Anna and Dr. Shahid Hasan also accompanied the ambassador. Central banks weigh a host of factorssuch as stability, liquidity and returns-when managing their foreign reserves. Most opt to hold dollars: according to the IMF, the dollar accounts for 62% of global foreignexchange reserves. The Central Bank of Russia (CBR), though, must also consider geopolitics.

On January 9th it revealed that it had dumped $101bn in dollar reserves last spring, shifting instead to euro and yuan holdings. The dollar had accounted for nearly half of its $430bn of reserves at the end of 2017 (see chart). Six months later only 22% of reserves were held in dollars, at least half of which were held outside America. Strikingly, yuan holdings jumped to nearly 15%, a share ten times the average for global central banks, and a reflection of China's growing importance for Russia's economy.

The shift took place against a flurry of sanctionsrelated news. In April 2018 President Trump's administration had slapped restrictions on Russian oligarchs, including Oleg Deripaska and Viktor Vekselberg, as well as their publicly-traded companies, such as Mr Deripaska's aluminium firm, Rusal. The move roiled markets and sent the rouble tumbling. American lawmakers were threatening tougher measures, including bans on trading new sovereign debt that would limit Russia's ability to tap bond markets.

Although freezing centralbank assets would have marked a radical escalation-beyond even the toughest measures discussed in Washington-the CBR opted for what Oleg Kouzmin of Renaissance Capital, an investment bank, calls "ultracautious portfolio management". American officials, fearing the impact of sanctions on industry.