India Preparing to Pay 1st Installment of Iran Oil Debt: Report
TEHRAN (Tasnim) – India is gearing up to pay the first installment of oil payments owed to Iran following the implementation of the nuclear agreement reached between Iran and world powers and the ensuing lifting of anti-Iran sanctions, media reports said.
According to a report by Reuters on Friday, Indian refiners have been urged by the government to get ready to deposit $700 million with United Commercial Bank in readiness for it to pass on the first instalment of oil payments to Iran ahead of the expected lifting of sanctions against Tehran.
The refiners, Essar Oil, Mangalore Refinery and Petrochemicals, Indian Oil Corp, Hindustan Petroleum Corp and HPCL Mittal Energy, together owe a total of more than $6.5 billion. The $700 million part-payment will be split in line of the proportion owed by each.
Back on August 18, Indian Finance Secretary Rajiv Mehrishi said his country plans to clear its $6.5 billion debt to Iran for oil imports in tranches.
"What is due to them, must be paid to them. It will not be one single bullet of $6.5 billion. It will be (in) tranches. They also don't want as bullet, they also want it in some kind of tranches. So we are working out with Iran," Mehrishi was quoted by the Press Trust of India (PTI) as saying.
Mehrishi indicated that the payments can be in a combination of US dollar or euro and Indian rupees.
"It will obviously be partly in dollars, partly in rupee. It could be euro also. Partly hard currency, partly rupee. Exact division is yet to be decided," he said when asked about the mode of payment gateway.
He, however, refused to elaborate on options being explored, saying "it is being worked out."
Since February 2013, the refiners have been paying 45% of payment due on purchase of crude oil from Iran in rupees through Uco Bank, Kolkata.
The remaining has been accumulating, pending finalization of a payment route and mechanism. They had last year paid nearly $3 billion in six installments through a limited payment channel following start of nuclear talks between six world powers and Iran.
