According to reliable sources, there is a high probability of India beginning barter trade with Egypt. In this episode, we will focus on strategies formulated by India to assist the crisis-hit Egypt.
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As per the sources, India is assessing the proposal to start the barter trade with Egypt in goods such as gas and fertilizer.
Egyptian President Abdel Fattah El Sisi visited India in January this year. An official familiar with the matter said that New Delhi could sign an agreement later this month during PM Narendra Modi’s visit to Egypt. The Middle Eastern country with several thousand years of history is facing a prolonged currency shortage.
“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 said.
The foreign ministry of India is in talks with relevant departments about the gas and fertilizer requirements to create a partial payment for the credit line which is worth several billion dollars to Egypt. New Delhi is seeking to diversify its fertilizer imports after 2021. Various Indian states had to face fertilizer shortages in 2021 due to Chinese export restrictions.
As part of the barter trade, Cairo is keen on importing wheat; however, New Delhi is unlikely to dispatch the grain due to the wheat export ban.
In May 2022, New Delhi banned wheat exports due to surging prices. While it is true that India is the second-largest producer of wheat, it had to ban the grain from being exported to control the rising prices. Cairo now depends on Moscow for its wheat requirements.
Ali Moselhy, Egypt’s supply minister, told the following to Reuters:
“It’s a negotiation. Which companies will be involved and in which commodities? All of that is still in discussion… There are a lot of discussions but up until now the model is not defined,” said Moselhy, who did not specify the size of a possible credit line.”
According to Reuters, the sources from India and Egypt do not wished to be named since they are not authorized to talk to the press.
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