India plans to pay for the imported Iranian crude in rupee credit line, to be used by Iran to purchase ‘non-strategic’ Indian commodities. Under the proposal, the National Iranian Oil Company (NIOC) will open a rupee account with Indian banks, and can use the money to purchase non-strategic commodities yet to be identified. The Press Trust of India reported today that a team of Indian officials would visit Tehran on 16 January to finalize the payment issue between the two countries.
India currently imports 370,000 barrels per day of crude oil from Iran, worth more than 1 billion dollars a month, using Turkey as a conduit to pay for it. This arrangement will come to an end shortly when the new US sanctions against foreign banks transferring funds through the Central Bank of Iran goes into effect.