Home » Iran to expand trade, investment and agricultural ties with Sri Lanka

Iran to expand trade, investment and agricultural ties with Sri Lanka


By: Staff Writer

May 02, Colombo (LNW): Consequent to Iranian President Ebrahim Raisi’s pledge to forge stronger ties with Sri Lanka during his recent visit to the island, Iran expresses willingness to further expand cooperation in trade and agriculture.

Agriculture Minister Mohammad-Ali Nikbakht has stressed the need to further expand cooperation with Sri Lanka in trade and agriculture.

Last year, Iran imported over US $70 million of products, especially tea and coconut, from Sri Lanka, Nikbakht has pointed out, IRNA reported.

Importing tea from Sri Lanka, through a barter mechanism, is a proper step, Ebrahim Raisi Iranian noted.

Iran imports more than 70,000 metric tons of dried tea leaves annually, he said, adding that nearly 30,000 mt of the product is produced in northern parts of the country.

The Islamic Republic is ready to provide Sri Lanka with its know-how in various fields of livestock, fisheries, and aquaculture, the official noted.

Earlier this month, Iran’s President Ebrahim Raisi paid an official visit to Sri Lanka to pursue the expansion of ties between the two countries.

Iran, which is still grappling with a 2012 economic sanction imposed by the United States is exploring new ventures and trade and investment in Sri Lanka, the island nation which is still recovering from an unprecedented economic crisis.

Sri Lanka is unable to pay for Iran investment and imports due to the US sanctions, but it has successfully started paying for the dues in crude imports before 2012 through a “tea for oil” deal.

“There is a huge potential for further corporation in multi-faceted areas. During discussion, Itan addressed key areas of mutual of interests. Including political, economic, and cultural corporation, reflecting very solid bilateral relations.”

Before the 2012 US sanctions, Sri Lanka heavily depended on Iranian light crude to its only refinery constructed by Iran in 1969. The island nation is now paying US $250 million due for crude imports through tea exports.

Iran is keen to cooperate with Sri Lanka in future projects utilizing their expertise in energy, water, agriculture, nanotechnology, medicine and biotechnology.

“Iran has also agreed to provide another 31 million euro grant for the rural electrification project,” Prime Minister’s office said in a statement.

“The Iranian side agreed that trade should be done in Asian currencies instead of US dollars.  Agriculture Minister of Iran  said  adding that banking arrangements have already been made to trade with Iran.

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