Iran is likely to dispatch its Central Bank Vice Governor Gholamali Kamyab to India this month after the Persian Gulf nation's efforts to get nearly $6 billion of past oil dues from refiners like Essar Oil faced hurdles over differences concerning foreign exchange rate.
With the US lifting sanctions, Iran wants its past oil dues to be cleared. But differences have now cropped up over foreign exchange rate, sources close to the development said, Economic Times reported. Iran sold oil to refiners like Essar Oil and Mangalore Refinery and Petrochemicals Ltd. in US dollar per barrel, 45% of the oil bill was paid in rupees in a UCO Bank account while the rest was to be cleared whenever banking channels open.
Now with the lifting of sanctions, Iran has presented its unpaid bill. But Essar Oil and other refiners want to pay Iran at the exchange rate prevalent at the time of buying crude oil in the last three years, sources said. Sources said Iran wants its dollar dues in full without factoring in the exchange rate. Refiners like Essar Oil on the other hand want to pay rupee equivalent of the purchase at the current rate. Iran, they said, wants dollar equivalent of the dues in euros.
Kamyab is likely to visit India later this month to discuss payment options, sources said.
Tehran has told India that the three-year-old mechanism of paying 45% of oil import bill in rupees and keeping the remaining 55% pending for payment channels to clear has come to an end.
It will be opening or reactivating euro accounts with Indian banks and would like to have the past money transferred from refiners into these accounts. The Persian Gulf nation is talking to State Bank of India for the purpose and has also opened an account with state-owned Industrial Development Bank of India.
National Iranian Oil Company would ask buyers of crude in India to open letters of credit in favor of Central Bank of Iran with SBI as was the case in past, sources said, adding that settlement could be done through the Asian Currency Union and IDBI.
