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Iran agrees to take all crude oil payments from India in rupee

15 Jul 2013 Evaluate

Iran has finally agreed to take payments for oil it sells to India entirely in rupees, after the euro route was blocked and Iran failed to arrange any alternate mode of taking payment for 55% of the oil it sold to Indian refiners. India has been paying Iran in Euros since July 2011 to clear 55% ($1.5 billion) of its purchases through Ankara-based Halkbank and remaining 45% through rupees in accounts of Iranian oil company opened in UCO Bank.

As Tehran has now agreed to take this overdue amount in rupee, the government has indicated that entire overdue amount will be cleared within a month. Iran has already accumulated $5-6 billion in the UCO Bank account and can use the money to purchase permissible services and goods, such as food, medicine and basic medical equipment.

India imports about 70% of its crude oil, last month, India along with a few other Asian countries managed another six-month waiver from the United States after it reduced its oil imports from Iran by 27% from its import of 2.6 lakh barrels of oil per day in last year, though the country has not received a single barrel of oil since April from Iran due to Insurance related hurdles.

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