Sheikh made the remarks at a ceremony at LCCI to welcome a high-ranking delegation from Iran's Southern Fars province headed by Governor General Hossein Sadegh Abedin.
Sheikh stressed the need for a greater share in bilateral trade, which would guarantee some economic benefits to Pakistan as well.
He said China and Russia have already started trade in their local currencies, and added that barter trade should also be actively facilitated since it can be a highly efficient mode of buying and selling.
He said it was a high time that we also put in place such mechanisms.
Sheikh complained that the bilateral trade between Iran and Pakistan has remained at the constant level of over one billion dollars in the last few years, and stressed, "And there exists a lot of potential to take it to over $2 billion mark if smuggling is curtailed and direct trade is started instead of trading via third destinations."
He said the smuggling of petrochemicals from Iran was adversely affecting Pakistan economy therefore there was a dire need of formalizing the trade between the two countries.
He suggested bringing the circular trade into the main stream bilateral trade in the larger interests of the two countries.
The meeting was also attended by Iranian Consul General in Lahore Muhammad Hossein Bani Asadi, President of Shiraz (the capital of Fars province) Chamber of Commerce, Industries and Mines Fereidoon Forghani, Senator Sardar Zulfiqar Khan Khosa, LCCI Senior Vice President Kashif Younis Meher, PBIT Vice Chairman Miftah Ismail, former LCCI Presidents Mohsin Raza Bukhari and Shahid Hassan Sheikh.
Senator Sardar Zulfiqar Khosa said that Punjab government was taking all possible measures to increase trade and economic relations with Iran.
He said the Chief Minister of Punjab, Mian Shahbaz Sharif, was spending all his energy to attract foreign investment in the province and the days "are not very far when the Province of Punjab will be the manufacturing hub of the country".
Also during the ceremony, President of Shiraz Chamber of Commerce, Industries and Mines Fereidoon Forghani said the chambers in the two countries should play their respective role in enhancing the bilateral trade and dissemination of trade-related information.
Forghani said a lot of business could be done provided the two sides have required information and this was the area where chambers of commerce could play their role.
He said the upcoming Iran Fair 2012 scheduled for May 31 would help in expansion of businesses.