India mulls barter trade with Egypt in credit line negotiations
Updated 6/18/2023 8:33:00 AM
Arab Finance: India and Egypt are considering a proposal to start barter trade, focusing on goods such as fertilizers and natural gas, Reuters reported on June 16th.
The move is part of a larger deal under which India may extend a credit line worth billions of dollars to Egypt, which is grappling with a foreign currency shortage.
The agreement is expected to be unveiled during Indian Prime Minister Narendra Modi’s visit to Egypt later this month, a source familiar with the matter told Reuters.
“The agreement would allow Egypt to make purchases in rupees and bartering is being considered as a means to settle this debt through the sale of Egyptian products that might be of use for India,” the source commented.
The Indian foreign ministry is consulting with related departments to discuss their interest in obtaining fertilizers and gas from Cairo as partial payment for the credit line, according to an Indian official.
India seeks to diversify its fertilizer imports, especially after facing shortages due to export restrictions and surge in prices imposed by China back in 2021.
As part of the trade agreement, Egypt expressed its interest in receiving wheat supplies and other commodities. Yet, the Indian official noted that New Delhi is unlikely to ship wheat due to its current wheat export ban.
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