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Pakistan is developing a strategic plan with a three-pronged approach with Russia. According to sources, the government is working on establishing government-to-government (G2G) frameworks and projects, fostering business-to-business (B2B) cooperation to boost trade and investment, and putting in place mechanisms to ensure safe trade and business operations.

The proposal has been endorsed by the Ministry of Foreign Affairs, as officials stressed the need for adopting viable strategies that could be taken up by a high-powered delegation set to visit Russia soon. However, the State Bank of Pakistan (SBP) has cautioned that doing business with Russian entities under sanctions could pose challenges.

The SBP noted that other nations, such as Turkey, have been able to conduct transactions with Russia using local currencies. This suggests that Pakistan may explore similar avenues to circumvent the threat of US sanctions and facilitate increased economic engagement with its northern neighbor.

The railways secretary outlined three crucial rail routes to build stronger connectivity with Russia and Central Asian countries:

Upgrading the Quetta-Taftan rail network: A memorandum of understanding (MoU) for this project was already signed in June 2024. A bilateral meeting

• expected this month to implement the MoU and identify areas of cooperation.

• Connecting the Kohat-Kharlachi rail network with Central Asian Republics through Afghanistan: This plan will be undertaken following a feasibility study.

• Establishing the Minelik Express: This rail link will connect Reko Diq with Gwadar, providing a direct and cost-effective route to the Arabian Sea for accessing markets in Azerbaijan and Russia.

The minister for national food security and research, as well as the minister for industries and production, supported a proposal from the special assistant to the prime minister on foreign affairs to develop comprehensive plans for holding negotiations with Russia. They sought guidance from the State Bank of Pakistan (SBP) on engaging in trade and business with Russia.

The SBP clarified that transactions not involving sanctioned Russian entities would not face major issues, though banks would still be cautious due to the sanctions regime and Financial Action Task Force (FATF) compliance concerns. The central bank also suggested exploring a barter trade mechanism as a way to boost ties with Russia.