18/02/2012 (The News International) - In October 2011, India exported 200,000 tons of premier basmati rice to Iran on 90-days credit. On 7 February 2012, Iran defaulted on payments worth about $144 million for rice shipped three months earlier. The All India Rice Exporters’ Association has now called on all its members to stop rice exports to Iran.

Iran buys 30,000 tons of palm oil from Malaysia every month. On February 8, Malaysian palm oil exporters, fearing payment default, stopped shipping palm oil to Iran. An additional 50,000 tons of palm oil a month comes from Indonesia. On February 9, Singaporean firms stopped supplying Indonesian palm oil to Iran on “concerns over the country’s ability to make payments”.

Ukrainian grain traders have now stopped shipping wheat to Iran because Iran is not being able to pay for it. According to Ukraine’s food minister, “As for the relations of grain traders with Iran, this is a matter of payments, not a state-level issue.”

At the current level, Pakistan’s exports to Iran amount to roughly $400 million while Iranian imports to Pakistan hover around $600 million. Seventy percent of Pakistan’s total export to Iran is rice and fifty percent of what we import from Iran is petroleum products.

How are we going to increase Pak-Iran trade from $1 billion to $10 billion? For the record, our annual rice exports to the world are under $2 billion. How about if we send all our rice to Iran? The billion dollar question is how will Iran pay for our rice-Iran has no dollars and no one in the world is willing to accept Iran’s letter of credit.

How about if we sell our rice in Iranian rials? Well, just prior to the Revolution 80 rials would buy a dollar. In December 2011 the rate was 10,000 rials-to-a-dollar and the going rate is 20,000 rials-to-a-dollar.

How about buying Iranian gas? Well, to begin with there has to be a pipeline but to build the pipeline we need $7 billion and no one on the face of the planet is willing to finance the pipeline. Some one intelligent once told me that ‘those who dream by day are cognizant of many things which escape those who dream only by night’.