Despite US pressures, Iran and Russia move toward strengthening economic cooperation

Tabnak – While the United States appears determined to pursue its policy of maximizing pressures on Iran, Tehran and Moscow are taking new steps to strengthen their cooperation in the economic sphere. Among other issues, Russia and Iran are moving toward realizing a free trade zone between each other.

According to the reports, Russia, Kazakhstan and Iran have signed a memorandum of understanding for cooperation in wheat trading, taking another step towards setting up a free trade zone.

The document was signed in Moscow Tuesday, bringing the countries closer to the free trade zone between Iran and the Eurasian Economic Union, which Russia has established with its neighbors.

“The memorandum is an integral part of the free trade zone agreement signed between the Eurasian Economic Union member states and Iran last year,” Kazakhstan's Deputy Minister of Agriculture Gulmira Issayeva said. Under the deal, Iran will import wheat for its private millers who will produce flour for export, her Iranian counterpart Ali-Akbar Mehrfard said.

Iran, he said, has enough wheat harvested inside the country to cover its needs but it can export Russian and Kazakh grain to other countries. Iranian private millers are not allowed to use domestic wheat for flour exports.

“In Iran, there is suitable infrastructure in the flour industry, which is twice as much as domestic demand. In addition, Iran's wheat silage is at a good level, and we now have 5 million tonnes of flour trade,” Mehrfard said.

Meanwhile, Iran’s Ambassador to Moscow Mehdi Sanaei said on Friday he expected the Iranian parliament to ratify the free trade agreement with the EAEU “in the near future.”

“The agreement is very important for Iran because it opens the gates to a big market for our country, and also opens the Iranian market to Russia and northern countries,” Mehr news agency quoted him as saying.

The union aims to ensure the free movement of goods, services, capital and workers between the member states.

In a separate development, Russian Deputy Foreign Minister Sergei Ryabkov confirmed his country's interest in opening of a settlement mechanism with Iran, launched by France, Germany, and the United Kingdom, to third countries.

“We have confirmed our interest, our interest in the fact that the INSTEX mechanism, which has already been created and is being launched by the European trio, is open to third countries, including Russia,” Riabova was quoted as saying by Russian media on Wednesday.

Britain, France, and Germany on January 31 issued a joint statement on the creation of the Instrument in Support of Trade Exchanges (INSTEX) that will allow trade between the EU and Iran without relying on direct financial transactions.

The European Union has vowed to counter US President Donald Trump’s renewed sanctions on Iran, including by means of a new law to shield European companies from punitive measures.