Pakistan has passed a special order to allow barter trade with Afghanistan, Iran and Russia for certain goods, including petroleum and gas, the Ministry of Commerce said on Friday.

Left with barely enough foreign exchange reserves to cover one month’s imports, Pakistan’s government is desperately trying to manage a balance of payments crisis and bring inflation under control after it hit a record of nearly 38% last month, Reuters reported.

The government order, called the Business-to-business (B2B) Barter Trade Mechanism 2023 and dated June 1, lists goods that can be bartered. State and privately owned entities would need approval to participate in the trade mechanism.

After Pakistan’s first purchase of discounted Russian oil in April, petroleum minister Musadik Malik told Reuters that Pakistan would only be buying crude, not refined products under the deal.

There was no confirmation about how the payment would be made. But, Malik said purchases could rise to 100,000 barrels per day (bpd) if the first transaction went smoothly.

Last year, Pakistan imported 154,000 bpd of crude oil, little changed from 2021, data from analytics firm Kpler showed.

In May, Pakistan Petroleum Dealers Association complained that up to 35% of the diesel sold in Pakistan had been smuggled from Iran.

Pakistan’s government has also ordered a clamp down on smuggling of flour, wheat, sugar, and fertilizer to Afghanistan.

The Ministry of Mines and Petroleum (MoMP) says in the next seven months, about $148 million will be invested in extracting mines in Sar-e Pul province.

In a trip to the province on Thursday, Minister of Mines and Petroleum Shahabuddin Delawar said that the process of investing in Sar-e-Pul mines will begin soon.

Delawar has promised the residents of Sar-e Pul that practical work regarding development in this province will begin within the next seven months.

At the meeting, local authorities and residents of the province also presented their suggestions for the development of the province.

Speeding up the work of mining, recruiting educated young people in the mining process, and implementing construction projects from  revenue obtained from the mines are among the most basic demands that were expressed at the meeting.

He also pledged that besides taking care of the basic needs of the people, priority will be given to employing professional youth in the province.

“So far, the vast works of this project have not started and those youths of this province who are professional will be employed,” said Delawar.

Sar-e Pul province in the north of the country, has coal mines and oil and is one of the wealthiest provinces in terms of untapped minerals.

Qashgari oil wells, which are in this province, are already operational.

The Deputy Prime Minister for Economic Affairs of Islamic Emirate of Afghanistan (IEA) on Thursday welcomed the recent World Bank report on Afghanistan’s economy.

The office says that facts related to the country’s economic situation are reflected in the report.

Mullah Abdul Ghani Baradar’s office said in a statement that “the Islamic Emirate believes that if the international community pays attention to positive interaction instead of imposing restrictions, Afghanistan will progress further in the economic field and the burden of responsibility on the shoulders of the international community will be reduced.”

“If all international organizations such as the World Bank present a true picture of the concrete realities of Afghanistan, the way of positive interaction with the Islamic Emirate will be paved,” the statement read.

The World Bank report states that Afghanistan’s exports and imports have increased, monetary stability has been maintained, and domestic revenues have increased.

According to the report, during January to April 2023, imports stood at $2.4 billion, reflecting a 27 percent growth against the same period last year.

Iran remains the most significant import origin country (21 percent), followed by Pakistan (18 percent), China (16 percent), and the United Arab Emirates (13 percent), the World Bank reported.

However, the Jan-Apr 2023 merchandise trade deficit at $1.8 billion is 38 percent higher than the $1.3 billion observed in the comparable period of 2022.

Unofficial data for January to April this year indicates that Afghanistan’s customs show total exports reached $0.6 billion — a 4 percent rise compared to the same period in 2022.

The export growth during Jan-Apr 2023 can primarily be attributed to an increase in the exports of coal, by 13 percent, and textiles by 14 percent, the report stated.

Pakistan remains Afghanistan’s largest export market accounting for 63 percent of total exports, followed by India (26 percent). Exports to Pakistan are mainly food and coal. Coal exports to Pakistan amounted to $140.7 million in Jan- Apr 2023 – 13 percent higher than the coal exports in the comparable period last year.