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Amid mounting US pressure on its trading partners to reduce business with Iran, a strong delegation from the West Asian country began business-to-business talks with its Indian counterparts here on Monday.
Sources privy to the developments said there was enthusiastic response from both sides during the first round of talks. India-Iran trade is over $12 billion and is heavily tilted in favour of Iran.
The sectors in which mutual interest was evinced included agro and allied products, pharmaceuticals, engineering, shipping, banking, petroleum products polymer, textile, as well as e-commerce.
Pharmaceuticals and agro products are free from UN sanctions, which India follows. An industry official, who was part of the meetings, said, “The business community does not want to let go of the opportunities in Iran. But, at the same time they are being cautious.”
Indian exporters to Iran are also seeking clarity on the recent tightening of US sanctions that target those helping Iran skirt the sanctions by barring them access to the US banking system.
On Monday, the Iranian business delegation met the Commerce Secretary. The business-to-business meeting was facilitated by the Federation of Indian Export Organisations. The Tuesday meeting is being facilitated by industry chambers FICCI and Assocham.
Oil imports
Meanwhile, Indian refiners have started cutting down crude oil imports from Iran. Though the Government is maintaining that no diktat has been issued to refiners, insiders say the refiners have been asked to look at other producing nations.
Those critical of the current bind that India is caught in say, “Let them (US) get us crude oil that is reasonably priced. We are paying a premium for their security concerns.”
Till now, Iran was India's second-biggest crude oil supplier after Saudi Arabia, meeting about 12 per cent of the country's needs, but the position has been taken over by Iraq. Indian refiners imported 171.41 million tonne of crude oil in 2011-12. Of this, 32.63 mt came from Saudi Arabia, 24.51 mt from Iraq, 17.67 mt from Kuwait, and 15.79 mt from the UAE. Iran accounted for 17.44 mt (18.499 mt in the previous year).
Sanctions Waiver
In the talks with the US Secretary of State, Ms Hillary Clinton, there are expectations that India may seek sanction waiver for crude oil imports. June 28 is the US deadline to punish those who do not significantly reduce oil imports from Iran. Exemptions have been given to some EU nations and Japan from the upcoming sanctions.
The US wants India to play a bigger role in pressuring Iran to abandon its nuclear ambitions. The issues likely to be discussed on Monday and Tuesday include stability in Afghanistan after the withdrawal of NATO troops and efforts to increase bilateral trade and investment.
In Delhi, Ms Clinton met the Congress President, Ms Sonia Gandhi, and the Prime Minister, Dr Manmohan Singh. Official level talks will take place on Tuesday.
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