Iran asks India to clear $6.5bn oil dues in 60 days


Destroy Erase Improve
Staff member
Source: Iran asks India to clear $6.5bn oil dues in 60 days - The Times of India

NEW DELHI: Iran has asked India to pay within two months $6.5 billion in past oil dues, partly in rupees and rest in dollars or euros, a top official said.

"The payment will be in at least three installments. The modalities of installments and the route are being worked out," he said.

The dues to Iran on crude oil that refiners buy have accumulated as Western sanctions blocked payment routes since 2013.

About 45 per cent of the oil import bill is paid in rupees in a Uco Bank branch and the rest has accumulated.

The official said the payment to Iran can be either through Reserve Bank of India (RBI) - in that case refiners will hand over the money to the central bank which will then do the onward transmission to Iran, or through a gateway notified by the government.

"Part of the payment in US dollar or euro and part in Indian rupees," he said adding Iran will open a new account with one of the Indian banks for receipt of the rupee payment.

Iran will use the rupee payments to settle bills for goods and commodities it imports from India.

The official said the new account will be different from the Uco Bank account which is a non-interest bearing account.

"They want the payments to be made to an interest-bearing account."

Since February 2013, refiners like Mangalore Refinery and Petrochemicals (MRPL) and Essar Oil have been paying 45 per cent of payment due on purchase of crude oil from Iran in rupees through Uco Bank, Kolkata.

The remaining has been accumulating, pending finalization of a payment route and mechanism. They had last year paid nearly $3 billion in six installments through a limited payment channel following start of nuclear talks between the Western world and Iran.

The outstanding has since climbed to over $6.5 billion.

Essar Oil owes $3.34 billion, MRPL ($2.49 billion) and Indian Oil Corp ($581 million) to Iran.

HPCL-Mittal Energy Ltd (HMEL) owes $97 million and Hindustan Petroleum Corp Ltd (HPCL) another $29 million.

Besides, about Rs 17,000 crore was lying in Iranian account with Uco Bank.

Last week, Finance Secretary Rajiv Mehrishi had told PTI that India is willing to clear the $6.5 billion in past oil dues and modalities are being worked out.

"What is due to them, must be paid to them. It will not be one single bullet of $6.5 billion. It will be (in) tranches. They also don't want as bullet, they also want it in some kind of tranches. So we are working out with Iran," he said.


The Power of x480
Staff member
I am no economic expert, but that sounds bad news to Indian economics.
Prices to be hiked a lot in recent times?

Time to do shopping 'now'? :confused:


India is really messing thing up, we neutral relationship with Iran and now these thing. I think this payment due from more than 2 or 3 yr ago


Destroy Erase Improve
Staff member
The relationship won't go bad I think as long as we deliver dues.

I wonder how we are going to clear our debt with the World Bank. Last I checked, we owe $172 Billion to the World Bank.


Human Spambot
^ In tamil we use to "Gandhi Kanaku" [Gandhi ka hisab] debt gone in drain. Are we really paying debts to World Bank


Geek in making
This one surely going to hit the economy. With current currency conversion we might be dealing something pretty bad only if the leaders can find a way to avoid it.


AFAIK,.. This is obvious dues and it is due to genuine reason: sanction imposed on Iran from western block. Now the ban is revoked and free trade is resumed with Iran, the dues should obviously be cleared keeping the regular business up and running.
So its the oil companies that have to pay,the oil price wont be affected & even the economy.

also i was reading in some news comments,that this might be a good opportunity for India to have a better relationship with iran.
Correct me if i am wrong. :lol:


Wise Old Owl
The worry probably might be about the sudden forex outgo causing further loss of rupee value against dollar.
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