‘India has to act fast on oil, gas imports from Iran’

India and Iran trade ties are feeling the strain of Western influence. This threatens to disrupt crude oil imports from Iran. Imports dropped to 18.5 million tons last fiscal (from 21 million tons in the previous fiscal). Mr. Mehdi Nabizadeh, Ambassador of the Islamic Republic of Iran, in an interaction with Business Line says energy (oil and gas) is an important component and India should take certain decisions before it is too late. ---Bilateral trade Our bilateral relations are not based on regional issues alone. There are international aspects, too. There is a certain ambiguity between the two countries on some international issues. In economic relations, we have witnessed good growth. From $9 billion in the last four years, bilateral trade has reached $14.9 billion. However, last year it declined to $13.3 billion. ---Where things went wrong The banking and financial system plays a big role in economic relations between countries. Through our political and cultural relations, we have tried to boost our economic relations. Unfortunately, in the last one year there has been some difficulty with India in the banking area. It is said that the problem is because of the UN resolutions against Iran, but in the same resolutions oil has been exempted from the sanctions. We believe that we can co-operate with India in this. ---On the trigger Some European countries because of the U.S. influence over their banking system have created trouble and this has extended to certain Asian countries as well. Till last year, we had a very good transaction mechanism with India through ACU (Asian Clearing Union). Unfortunately, ACU has stopped conducting transactions. This has not only affected ties between Iran and India, but with all the member countries of ACU. We have tried very hard to find ways for transfer of money (clear the oil import debt which Indian refiners owe to suppliers in Iran. Three or four months ago, the last transaction was done through a German bank. But that also stopped under Western influence. Now, we are routing it through some other countries. ----On the mechanism A month ago, there was a meeting of the officials of the Reserve Bank of India and the Central Bank of Iran. It was decided that a joint group of these banks will visit some countries and work out a mechanism. One of the countries was Turkey. Other countries will also be visited in future. ----Payment through Turkey Some part of money has been transferred through Turkey. The Central Bank of Iran has approved the route of transaction. We hope this route will work out. Negotiations with some other countries are under way. So we may not have any problem in exporting oil to India. ----$5-billion debt and oil supplies When the total debt is too high on an exported item, it is difficult to assure continued supply. We and the Indian Foreign Ministry are trying our best to ensure assured supply. But the supplier expects money. Most of us wish that the supplies continue. But if the debt not paid, it will become difficult. It was initially decided that supplies would be stopped from March. But after deliberations, supplies were continued. At the last meeting (one month ago), it was decided that supplies would be continued till the end of July. But, given the solution that we have found now, the deadline may be extended. ----Currency of transaction The currency (euro) for transfer of money through Turkey was decided by the banking system of the countries. We will disclose the names of other countries under consideration only when a decision is taken. We are dealing with countries such as Japan, China, and Korea. Each country has found its solution. We hope India and Iran will also find their mode of payment. ----Fuel-swap arrangement Yes, we can consider this. We are already swapping fuel with some other countries. But, surely, our relations with India are better. ----LNG exports This has become an old issue. An agreement was supposed to be approved by the National Iranian Oil Company, which did not happen. Though this issue is closed, we are discussing investments in South Pars Phase 12. We want to supply gas. However, India should not lose the opportunity. We are talking to other countries, too. Once the opportunity is missed, we cannot supply, even if we want. ----Farsi block The Indian side has not expressed itself seriously on this. We have had some discussions, but without much success. ----Iran-Pakistan-India gas pipeline project We were having good negotiations. But, suddenly they stopped. The excuse given was security concerns. But India is going ahead with the Turkmenistan-Afghanistan-Pakistan-India gas pipeline project. So, here comes the politics. India should take certain decisions. Energy is an important component for development. Both countries have to work together. It can't be one-way.