New rial-rupee mechanism to settle India-Iran payment issues

New Delhi, May 16 (PTI) India today said a new rial-rupee payment arrangement has been put in place for bilateral trade with Iran. The problem with Iran began after the Reserve Bank of India, in December 2010, withdrew the Asian Clearing Union (ACU) mechanism under which payments were made to Iran. "Rial-rupee payment arrangement have been put in place for bilateral trade between India and Iran," Minister of State for Commerce and Industry Jyotiraditya Scindia said in a written reply to the Rajya Sabha, the upper house of India's Parliament. He was replying to a query on whether India has taken steps to help its exporters sending consignments to Iran. Iran imports goods like textiles and agricultural products from India which relies on Tehran for 12 per cent of its total crude oil imports. Scindia replied in the positive to a query on whether India continues to export goods to Iran inspite of US and Euro zone sanctions. "India exports goods to Iran in accordance with its international obligations of United Nations sanctions on Iran," Scindia said. On proposed implications of these sanctions, he said they have the "potential to disrupt India's trade with Iran". Washington has been urging India to cut down its oil import from Iran for a waiver from US sanctions. To another query, Scindia said All India Rice Exporters Association members had informed they were facing problems in receiving payments for shipments of rice made to Iran. The overdue amount was reported to be about Rs 2.0 billion, he said, adding the Indian embassy in Iran has taken up the matter with respective Government authorities in Iran for getting the payments cleared. "As per available information, the defaulters are Iranian private companies and not government entities," Scindia added. PTI