Russia And Iran To Begin Banking & Finance Cooperation

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Russian-Iranian combined resources equate to the world’s eighth largest economy and one of the world’s largest energy providers 

The Iranian Ambassador to Russia, Kazem Jalali has stated that Russian and Iranian officials are set to discuss banking and financial cooperation.

The parties are also looking at expanding joint economic cooperation. Iran signed off a free trade agreement with the Eurasian Economic Union last year, and like Russia is under heavy trade and financial sanctions by the United States. The two countries also signed a 20 year cooperation agreement in 2021.

Cooperation could involve the use of Russia’s SPFS inter-banking system as an alternative to SWIFT, which disconnected Iranian banks in 2019. Trade settlement in Rubles as well as exploring non-dollar trade is also likely to be on the agenda.

Combined, the Russian and Iranian economies in terms of GDP are valued at some US$2.063 billion, which collectively makes them the world’s eighth largest economy, higher than Brazil and slightly less than France. The two countries also complement each other in energy, with Russia possessing the world’s largest gas reserves and Iran the world’s fourth largest oil reserves.

The two countries are linked by the International North-South Transportation Corridor (INSTC), a multi-modal route that extends via the Caspian Sea to Russian Ports near Astrakhan, and to Iran’s Caspian Ports at Rasht. From Astrakhan, goods can be shipped across Russia and from Iran’s southern Bandar Abbas and Chabahar ports, to the Middle East, East Africa, India and South Asia.

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