Jan 27, 2016, 11:25 AM
News Code: 81937624
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Envoy: Removal of sanctions a tremendous opportunity

Tehran, Jan 27, IRNA - Iran will receive its oil money once banking sanctions are lifted, said Indian Ambassador to Tehran Shri Saurabh Kumar in an interview with Iran Daily on Tuesday.

Ditching the dollar, Iran and India have agreed to settle all outstanding crude oil dues in rupees in preparation to future trade in their national currencies. The dollar dues — $6.5 billion equaling 55 percent of oil payment — would be deposited in National Iranian Oil Co account with Indian banks, indianexpress.com reported.

Sources said work was underway to amend the agreement with Iran to allow entire crude oil payment to be made in rupees. “Finance Ministry is moving a cabinet note on withholding tax exemption on oil payments,” they said.

Since 2013, Indian refiners have been depositing 45 percent of their oil payments to Iran in rupees with UCO Bank and withholding the remainder after a payment route through Turkey’s Halkbank was stopped under US and European sanctions.

The payment agreement needs amendment as tax exemption is contingent on the pact notified by the center in January 2012 which allows only 45 percent of oil payments in rupees. Budget 2012-13 exempted Indian refiners from withholding 40 percent tax while paying NIOC.

**Tehran-New Delhi ties

Iran and India have historical relations particularly those of people-to-people and cultural bonds, Kumar mentioned.

Kumar added the two states enjoy favorable economic ties as well.

Shifting to the recent nuclear deal, he congratulated Iran on the implementation of the Joint Comprehensive Plan of Action and removal of the sanctions.

The historic breakthrough offers tremendous opportunities to Tehran and the world, opined the envoy, assuring that it will have positive impacts on relations between Iran and India. According to him, Tehran-New Delhi trade is currently estimated at $13-$14 billion.

'Other deals are also conducted via the UAE – the portion that is not added to the official figure. In the post-JCPOA era, there would be a significant increase in bilateral trade. Iran is the second largest crude supplier to India. With the lifting of the embargoes, the two sides’ energy trade, mainly in the hydrocarbon sector, will be catapulted to the pre-sanctions era’s volume.'

He listed Indian export items to Iran as agro products — mainly rice and tea — auto parts and textiles, adding New Delhi looks forward to a sharp rise in exports to Tehran.

Kumar is convinced that removal of the sanctions offers both countries a tremendous opportunity to forge ties.

Iran’s Economy Minister Ali Tayyebnia visited India last December, discussing relations with Indian officials, recalled the official, calling for speeding up the pace.

'January 26 is the Republic Day of India. The Constitution of India was adopted on this national day in 1950. The Indian president addresses the nation and the prime minister holds a special ceremony on this day,” added the ambassador.

Kumar read out President Pranab Mukherjee’s message on the occasion.

'On January 26, 1950, our republic was born. On this day, we gave ourselves the Constitution of India. This day saw the culmination of heroic struggle of an extraordinary generation of leaders who overcame colonialism to establish the world’s largest democracy. The year 2015 has been a year of challenges. During this year, the global economy remained subdued. Unpredictability ruled the commodity markets. This year, with an estimated growth rate of 7.3 percent, India is poised to become the fastest growing large economy,” read the message.

India achieved independence from British rule on August 15, 1947 following the Indian independence movement noted for largely peaceful non-violent resistance and civil disobedience led by Mahatma Gandhi.