In­dia, Iran scram­ble to end deadlock over crude oil pay­ments

The Pak Banker - - Front Page -

MUM­BAI: In­dia and Iran scram­bled to end a deadlock over crude oil pay­ments with their cen­tral banks sched­uled to meet Fri­day af­ter re­cent curbs from New Delhi threat­ened to dis­rupt sup­plies to Asia's third-largest econ­omy.

In­dia is try­ing to work out an al­ter­na­tive mech­a­nism for pay­ments to Ira­nian com­pa­nies af­ter the Re­serve Bank of In­dia last week closed the Asian Clear­ing Union route, a move which ef­fec­tively stops set­tle­ments in U.S. dol­lars and the euro. Of­fi­cials from In­dia's cen­tral bank, fi­nance and oil min­istries, and se­nior oil in­dus­try ex­ec­u­tives have been locked in hec­tic ne­go­ti­a­tions to re­solve the im­passe.

"The deputy gover­nor of Iran's cen­tral bank is com­ing to meet RBI of­fi­cials to­mor­row [Fri­day]. Oil com­pa­nies would also be present there," Oil Sec­re­tary S. Sun­dare­shan told re­porters Thurs­day at a hur­riedly called press con­fer­ence in New Delhi. "A de­ci­sion could be ex­pected in the next few days."

While he didn't name the Ira­nian of­fi­cial, the Iran cen­tral bank web­site lists Seyed Hamid Pour Mo­ham­madi as the deputy gover­nor.

An email sent to Mr. Mo­ham­madi's of­fice didn't elicit a re­ply. The rush to end the stale­mate high­lights the fine bal­anc­ing act that New Delhi has to main­tain be­tween se­cur­ing its en­ergy needs and its grow­ing prox­im­ity with the United States. Iran is In­dia's sec­ond-largest sup­plier of crude oil, af­ter Saudi Ara­bia. In­dia im­ports $11 bil­lion of crude an­nu­ally from Iran-about 14% of its to­tal crude im­port bill, ac­cord­ing to govern­ment data. -PB News

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