Iran turns to traditional partners as EU tarries on bypassing US sanctions
Tehran (Basirta) :Foreign Minister Mohammad Javad Zarif says Iran is working with its traditional partners such as China, Russia and India to circumvent the US sanctions.
As Reportede by Qods News Agency (Qodsna) Zarif told reporters in New Delhi
Tuesday that the European Union is moving more slowly than expected to
facilitate non-dollar trade with Tehran through a mechanism called the special
purpose vehicle (SPV).
"We continue to work with the Europeans for the special purpose vehicle but we
will not wait for them [to act]," said Zarif who arrived in the Indian capital
late Monday for a three-day visit.
"We are working with our traditional partners like India, China and Russia so
that we continue to serve the interests of our people," he added.
EU foreign policy chief Federica Mogherini said last Wednesday that efforts to
implement the special purpose vehicle for trade with Iran would continue well
into 2019.
So far, the Europeans have defaulted on two deadlines which they had announced
for bringing the SPV into operation. The vehicle purportedly aims to ensure
economic benefits for Iran from staying in a 2015 nuclear deal after President
Donald Trump recanted it in May.
On Saturday, Foreign Ministry spokesman Bahram Qassemi said Iran "holds Europe
definitely responsible for failing to implement the financial mechanism,"
warning that the bloc should account for the "consequences" of the delay.
Qassemi said the European Union, not least the three European parties to the
deal with Iran – Germany, France and Britain – "are captive and hostage to the
American economy.”
As such, Tehran has not been sitting on its hands. On Sunday, Deputy Minister of
Petroleum Amir Hossein Zamaninia said the country had found new customers for
its oil.
"Despite US pressures on the Iranian oil market, the number of potential buyers
of Iranian oil has significantly increased due to a competitive market, greed
and the pursuit of more profit,” he told the Ministry of Petroleum’s Shana news
agency.
Iran’s major oil clients continue to take shipments under a 180-day grace period
given by the Trump administration to reduce liftings and find new suppliers.
As Iran’s second oil buyer, India is one of the countries given waivers by the
US to continue Iranian oil imports.
Indian refiners to resume Iran oil imports
On Monday, Indian industry sources said state-run Bharat Petroleum Corp and
Hindustan Petroleum Corp will each import 1 million barrels of Iranian oil in
February after a gap of three months, taking the nation’s overall purchases from
Tehran to 9 million barrels.
Top refiner Indian Oil Corp will lift 5 million barrels, while Mangalore
Petrochemicals Ltd will buy 2 million barrels, Reuters quoted the sources as
saying.
Earlier this month, New Delhi exempted rupee payments by Indian Oil Corp to Iran
for crude oil imports from steep taxes.
"Iran has been and will be a reliable source of oil supply to India,” Zarif said
on Monday as he arrived in New Delhi to take part in an annual research forum
attended by economists and entrepreneurs.
Zarif said he had used the opportunity to bring along "a big economic
delegation” comprising of representatives from the private and state sectors for
talks with their Indian counterparts.
Iran and India, the minister said, have maintained their good relations in the
wake of the resumed US sanctions.
He cited "a good banking agreement with India which was signed following the
sanctions, through which imports and exports as well as other financial needs
will be handled.”
Bank Pasargad to open branch in Mumbai
India’s Union Minister Nitin Gadkari said after a meeting with Zarif Tuesday
that Iran's Bank Pasargad will open a branch in Mumbai within the next three
months to process mutual transactions.
The Iranian oil money is currently being kept in India’s government-owned UCO
Bank in the Indian currency, which has led to a debt buildup because of the US
sanctions.
The income deposited with an Indian bank is subject to a withholding tax of 40
percent plus other levies, further complicating oil purchases from Iran by
India’s refiners.
Early this month, the Indian government intervened and exempted rupee payments
to Iran from the steep tax.
Zarif said there were numerous areas of cooperation for boosting ties, one of
them being Iran’s strategic port of Chabahar. "Indians are keen on being present
in Chabahar as well as in Iran’s transit infrastructure,” he said.
Gadkari said India was hoping to fully operationalize Chabahar, with the Bank
Pasargad branch in Mumbai intended to handle the related transactions.
Iran's FM Zarif (C-L) and India’s Union Minister Nitin Gadkari (C-R) hold talks
in New Delhi on Jan. 8, 2019.
The minister termed his meeting with Zarif on Chabahar as "very fruitful,"
saying a lot of issues had been resolved during the detailed discussions.
"Chabahar Port is very important for us. We are working very hard on it... Some
problems were there, but the Iranian government and their minister... are also
in the process to resolve all the issues as early as possible. I am confident
that we will be in a position to start full function of Chabahar Port at the
earliest," he said.
Barter trade via Chabahar
Chabahar on the coast of the Gulf of Oman is Iran's southernmost city. The port
is easily accessible from India's west coast and New Delhi hopes to utilize its
transit potentials to embolden the country's connectivity footprints.
Gadkari said India had placed $85 million machinery order for Chabahar and the
first ship from Brazil had already been received at the port.
India took over the operations of the first phase of Shahid Beheshti Port in
Chabahar in December 2018. Commercial operations began the same month with the
arrival of a Cyprus-registered bulk carrier with 72,458 tonnes of corn cargo.
India, he said, can provide steel rails and locomotive engines to Iran, and
receive urea in return.
Zarif also noted that he was negotiating higher urea sales at "reasonable" rates
with Indian officials.
"We are very happy that both UCO Bank of India and Pasargad Bank of Iran are
getting started with the business," the Iranian minister said, adding the two
banks will facilitate transactions relating to operation of berths at Chabahar
Port.
Source: Qodsna