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Call for Easing Oil Equipment Export
Energy

Call for Easing Oil Equipment Export

An official of the Society of Iranian Petroleum Industry Equipment Manufacturers said Iran is struggling with fundamentals to boost the export of oil industry equipment.
Mohammad Hassan Didevar, a member of the board of SIPIEM, said Iran's opaque regulations in the financial and banking sectors and the government-dominated economy create big loopholes for rent-seeking and leave little room for private-sector companies to boost exports, ILNA reported.
"The export (of oil equipment) calls for addressing customs difficulties, offering incentives to foreign and domestic investors, setting proper [export] tariffs and allowing the import of parts that are not produced inside the country," he said. Didevar added that Turkish and Chinese producers of oil equipment present the biggest challenge to Iran's market share, ILNA reported.
"The Chinese and the Turks spare no effort in exporting their products," he said.
The official also said Iraq and Afghanistan as well as CIS countries are the biggest markets for Iran's oil equipment.
CIS, or the Commonwealth of Independent States, is a regional organization formed after the breakup of the Soviet Union. It is made up of Russia, Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, Ukraine and Uzbekistan.
Didevar hoped that the easing of western sanctions against the Islamic Republic will ease foreign trade.
Iran and six world powers reached a historic agreement in July 2015 to place time-bound curbs on Tehran's nuclear program in exchange for lifting some sanctions against it.
The implementation of the nuclear deal on January 16 allowed Iran to reconnect to the global community after years of financial and trade embargos that damaged its economy and hurt its oil sector.
Despite setbacks in exports, it was not all doom and gloom for domestic equipment manufacturers, according to the deputy chief executive of Iran Power & Water Equipment & Services Export Company (SUNIR).
Masoud Hojjat also said SUNIR provided electricity to 1,000 small towns and villages in far-flung Sri Lanka, using Iranian equipment.
SUNIR started operations in May 2010—before the US and the European Union intensified sanctions against Tehran—under an engineering, procurement and construction contract.
Hojjat described the deal as a turnkey project, under which SUNIR was given full responsibility for implementing the project and handing it over in fully operational form to the client.
"The project is almost fully complete and SUNIR is handing over the project to Sri Lankans," he said.
The large-scale project was hit by delays because most banks in and around the tiny island nation of Sri Lanka south of India refrained from cooperating with Iranian banks to fund the project.
SUNIR, which signed a $600 million agreement this month to build three power plants in Afghanistan, is involved in 17 projects in Afghanistan, Pakistan, Iraq and Armenia, among others.

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