India, Iran may soon break impasse over crude oil payments
29 Jan 2011
New Delhi: India and Iran may likely resolve differences over the payment mechanism for crude supplies with the Indian government willing to advance payments in any convertible currency other than the dollar.
''We have asked Iran to work out how they will receive payments on the last leg for exporting crude to India. We are willing for any convertible currency other than the dollar. It is now for Iran to decide,'' a finance ministry official was quoted as saying. He clarified that Delhi would even consider the euro as an option.
He expressed confidence that the issue would be resolved soon, not later than March.
The impasse over payments between Indian and Iran for crude supplies made by the latter to the former resulted from a Reserve Bank of India directive last month because of which payments for imports of oil and gas from Iran now had to be settled outside the Asian Clearing Union (ACU).
The ACU is a regional payment mechanism between nine nations, including India and Iran, through which payments can be made either in dollar or euro.
Iran had earlier insisted it would not trade outside the ACU mechanism.
Iran is the second largest supplier of crude to India after Saudi Arabia exporting about 21 million tonnes oil to India annually.