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India, Iran facing oil payment dispute

India, Iran facing oil payment dispute

India said Friday it was making efforts to settle a payment dispute with Iran regarding the purchase of large quantities of Iranian crude.
The disagreement arose after India's central bank said deals with Iran must be settled outside the Asian Clearing Union system, a regional payment arrangement.
It was used by the central banks of member-nations _ Bangladesh, Bhutan, India, Iran, Nepal, Pakistan, the Maldives, Myanmar and Sri Lanka _ to settle bilateral trades.
Until 2008, payments under the ACU mechanism were made in U.S. dollars, but after Washington imposed sanctions against Iran over its suspected nuclear program, the currency shifted to Euro.
Iran has refused to sell oil under the new rules.
Iran is India's second largest crude oil supplier after Saudi Arabia and meets more than 12 per cent of its oil needs.
On Thursday, Vishnu Prakash, the External Affairs Ministry spokesman, said the dispute was a technical issue and the Reserve Bank of India, the country's central Bank, was seized of the matter.
"Efforts are being made to resolve the issue as soon as possible. There is no question of India acting under pressure of any country," Prakash said in a reference to Indian media reports that the United States wanted New Delhi to reduce its dependence on the Iranian oil.
India may not be able to import 10 million barrels of crude oil from Iran in January in case the two sides fail to settle the payment dispute, the Press Trust of India news agency said.
India imported 21.3 million tons of crude oil from Iran in 2009-2010.


Updated : 2021-05-06 13:02 GMT+08:00