Amid Western sanctions that make large money transfers and bank payments difficult, Russia uses an old-fashioned method to help keep its economy afloat: Barter.

Can a currency based on potatoes be far behind?

Source: Moscow Times

Companies from Russia and Pakistan have launched a barter trade mechanism, an agreement to this effect was signed on the sidelines of the first Pakistan-Russia trade and investment forum in Moscow on Tuesday, the TASS news agency reported on Tuesday.

Russian company Astarta-Agrotrading will export chickpeas and lentils in exchange for tangerines and rice from Pakistani Meskay + Femtee Trading Company.

Under the agreement, the Russian company will supply 20,000 tons of chickpeas, while the Pakistani company will supply 20,000 tons of rice, the agreement says.

Under another contract, the Russian side will supply 15,000 tons of chickpeas and 10,000 tons of lentils in exchange for 15,000 tons of tangerines and 10,000 tons of potatoes.

"Russia and Pakistan are experiencing certain difficulties in making mutual payments. Therefore, the two companies have decided to launch a barter trade mechanism," TASS quotes Pakistan's Deputy Minister of Commerce Nasir Hamid as saying.

Barter trade schemes that do not involve money transfers or bank payments help companies avoid the scrutiny of Western sanctions watchdogs, experts say.