India said Tuesday it only subscribes to the UN sanctions on Iran and not the US ones amid indications it may be looking to Tehran for importing crude.
"We don't subscribe to the US sanctions, we subscribe to the UN sanctions. We were party to the UN sanctions, to the UN resolution and voted for it," said External Affairs Minister Salman Khurshid to a question on what India plans to do to circumvent US sanctions on importing oil from Iran.

Speaking on the sidelines of a FICCI event here, the minister said that the UN sanctions on Iran over its nuclear programme apply to India.

Besides this, he said there were other issues like "whether assurances are available, whether vessels are available for carrying the oil and if there are banking systems to make the payment. All matters have to be considered before saying this is what we will be able to do."

The minister's comments come in the wake of suggestions that India could save $8.5 billion in foreign exchange spending on crude if it relies more on supplies from Iran, which is able to accept payment in rupees.

Khurshid also said that economists and bankers were examining how to manage to pay for the Iranian oil with the earlier mode of payment by India through an Ankara bank being switched off.

"What happened in the past is the banking channels available to us through Turkey have now been switched off... So, how we manage it, it is for the economists and bankers to see," he added.

Asked to specify how India would pay for Iranian oil, he said he could not say how it would be paid for.

Khurshid also said that Commerce Minister Kamal Nath was in touch with many countries over importing oil. "It is a critical moment and we will need to be doing some tiding over," he said.

The US and European Union sanctions have pushed Tehran into accepting payment in rupees for some of its oil and higher volumes could support the Indian currency.

Oil Minister M. Veerappa Moily, in a letter to Prime Minister Manmohan Singh, has detailed plans to save $20 billion in foreign exchange spending, suggesting that about 11 million tonnes of crude can be imported from Iran in this fiscal.

The prime minister has asked the ministry for a $25 billion cut in the oil import bill to narrow the current account deficit.

India in the last fiscal imported 13.1 million tonnes of oil from Iran.

By Business Standard

 

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