India’s media reported on Sunday that Iran has asked the country to clear its past oil dues amounting to over $6 billion in euros within six months.

Iran has told the Indian authorities that a previous mechanism for making payments to Tehran over sales of oil to New Delhi has come to an end.

The mechanism envisaged paying 45 percent of oil dues to Iran in rupees and keeping the remaining 55 percent pending for payment channels to clear.  It was in place for three years, reported the Indian Express.

The pending payments now total to over $6 billion which Iran has agreed to receive in installments over the next six months, Indian officials have told the daily.

The Central Bank of Iran (CBI) has informed India that the installments should be made in euros because Iran will not be able to undertake dollar settlements through the US financial system.

Iran will be opening or re-activating euro accounts with Indian banks and would like to have the money transferred from refiners into these accounts, the Indian Express added.

Essar Oil and Mangalore Refinery and Petrochemicals Ltd (MRPL) is likely to be asked to clear its outstanding of close to $3 billion first.

Indian Oil Corp (IOC), which owes over $400 million to Iran, may be the second in the queue followed by smaller payments by HPCL-Mittal Energy Ltd (HMEL) and Hindustan Petroleum Corp.

The Indian Express further speculated that use the money to make payments for imports of steel and other commodities from India.

By Press TV