The trade relations between Iran and Russia have been affected by various factors during the history that the two countries are connected by long borders. In this article, the history of trade relations between Iran and Russia, opportunities and challenges and ways to develop economic relations between the two countries will be discussed.
History of trade relations between Iran and Russia
Business relations between Iran and Russia began during the Afshari period. In the 17th century, trade between the two countries was growing, and the first Iranian embassy to Russia was established in 1702. In the 19th century, trade between the two countries decreased due to the involvement of the British and French empires in Iran’s political and economic issues. With the end of the Russian Empire in 1917 and the establishment of the Soviet Republic, trade relations between the two countries returned to prosperity.
During Shah Pahlavi’s period, trade between Iran and Russia grew due to friendly and close relations in political and economic matters. But after the Islamic revolution, the relations between Iran and Russia were affected by various factors. During the Iran-Iraq war, Russia, as one of Iraq’s supporting countries, reduced relations with Iran. But after the end of the war, trade relations between Iran and Russia returned to their prosperity and in the 90s, the two countries were able to develop their relations.
Opportunities and challenges in trade relations between Iran and Russia
Opportunities:
1. Volume of trade between the two countries: Considering the high volume of trade between Iran and Russia, there are many opportunities in various sectors, such as industry, agriculture, technology, energy, transportation, etc. for both countries.
2. Western sanctions: Considering the Western sanctions against Iran, Russia, as one of the countries that ignores the Western sanctions, has more opportunities to develop business relations with Iran.
3. Geographical connections: Despite the common borders between Iran and Russia, these two countries have very close geographical connections. These connections can help develop trade and economic exchanges between the two countries.
4. Variety of products: Iran and Russia can help each other and cooperate in various sectors, such as exporting oil, gas, steel, machinery, electronic equipment, etc. due to the variety of products they produce.
Challenges:
1. Competition with other countries: Iran and Russia face competition from other countries such as China, India, Turkey and Europeans in various sectors. To develop trade relations between the two countries, one should focus on competing with other countries.
2. Economic sanctions: Both countries have faced economic sanctions in recent times. These sanctions may reduce trade between the two countries.
3. Market fluctuations: Sanctions, oil price changes and other market factors cause fluctuations in the trade market between the two countries.
Ways to develop economic relations between Iran and Russia
1. Development of trade between two countries: To develop economic relations, trade between two countries should be developed. For this purpose, different markets such as industry, agriculture, energy, etc. should be taken into consideration.
2. Creation of facilities and financial facilities: To facilitate trade and economic exchanges, financial facilities and facilities such as banking facilities and stock exchange should be created.
3. Cooperation in joint production: To develop economic relations, it is necessary to cooperate in joint production. This cooperation can help to develop technology, improve product quality and reduce production costs
Business relations between Iran and Russia are very important due to the location of these two countries in areas close to each other and their strategic position. These two countries have a high potential for commercial cooperation due to the existence of rich natural resources and being located in the transport routes between continents.
However, trade relations between Iran and Russia have been strained in recent years due to international sanctions against Iran as well as economic stagnation in Russia. With the JCPOA and the lifting of some sanctions, the business situation between the two countries has improved.
Other commercial cooperation between the two countries
Currently, Russia is one of the most important trade partners of Iran, and Iran is also an important market for Russia for its exports and imports. Oil, gas, steel, automotive and heavy machinery products are among the products that Iran exports to Russia, and on the other hand, Russia, as one of the largest producers of grains and agricultural products in the world, agricultural products, agricultural machinery, household appliances and Exports electricity to Iran.
Also, the two countries can cooperate in other fields, including defense and space industries, nuclear energy production, transportation, tourism and e-commerce.
However, there are still problems in trade relations between Iran and Russia that can be harmful for both countries. One of these problems is the lack of investment and technology in Iran. Iran seeks to attract foreign investors in areas such as machinery production and information technology. But the economic and political sanctions against Iran have prevented the attraction of foreign investment.
In addition, banking and currency exchange restrictions have also created problems in business relations between Iran and Russia. Many Russian companies cannot do business with Iran easily because many international banks cannot cooperate with Iran due to sanctions. This issue has caused many Russian companies to look for other ways to do business with Iran.
Also, political relations between Iran and Russia can also affect business relations. If political relations between the two countries improve for some reason, this can increase trade between the two countries. But if political tensions increase, trade relations may also be affected.
In general, business relations between Iran and Russia are developing as a branch of bilateral relations between the two countries due to the existence of high potentials and access to valuable natural resources. However, to develop these relations, attention should be paid to solving the existing problems, including the sanctions and banking problems.