New Delhi to Pay Iran $900 mn in Oil Dues in 2 Tranches

Published: 18th October 2014 06:00 AM  |   Last Updated: 17th October 2014 11:06 PM   |  A+A-

NEW DELHI: As a part of the pending dues to Iran for oil imports, India will pay Iran $ 900 million in two tranches starting next week.

Sources said the payment will be on over and above $1.65 billion it had paid in June-July to clear more than one-third of over $4 billion in dues that had accumulated.

India, Iran’s top oil client after China, imported about 267,800 barrels per day (bpd) of crude from Tehran. Iran’s share of total Indian oil imports was about 7 per cent in the first nine months of this year compared with 4.9 per cent last year, tanker data showed.

Indian refiners — Mangalore Refinery and Petrochemcials, Ltd (MRPL), Essar Oil, Indian Oil Corporation (IOC) and Hindustan Petroleum Corporation Ltd (HPCL) — will make payment of the first installment of $400 million on Monday or Tuesday, sources added.

The remaining $500 million will be paid before November 24.

Since February 2013, when the US blocked payment channels to Iran for its nuclear programme, India has been paying 45 per cent of its Iran oil bill in rupees through a UCO Bank branch in Kolkata. For the remainder, it had been waiting for a way to make the payment.

While the payment of the first installment has been fixed, the date for next will be decided by the Reserve Bank of India, sources added.

Indian refiners had paid the previous $1.65 billion in three equal installments of $550 million each — first on June 26, second on July 8 and third on July 24.

Rupee payments equivalent to $400 million will be deposited by Indian refiners in the UCO Bank account, which will now be transferred to the RBI for onward credit to the central bank of the United Arab Emirates, which will make payments in dirhams to Iran.

Since July 2011, India had been paying in euros for 55 per cent of its purchases of Iranian oil through Ankara-based Halkbank. The remaining 45 per cent was remitted in rupees through UCO Bank.

The Euro payments ceased from February 6, 2013, but the portion of rupee payments continued through Uco Bank.


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