Iran Willing to Invest in India Refinery

EghtesadOnline: Iran is willing and ready to invest in the development of Nagapattinam refinery in Southern Tamil Nadu state, a senior Iranian diplomat said in New Delhi on Wednesday.

News ID: ۷۸۴۷۶۶

20 July 2019

“We have announced our readiness to invest in the refinery,” said Iran's Ambassador to India Ali Chegeni, ILNA reported.

There are no restrictions to working with India in investment spheres or any kind of joint venture, he noted, adding, "We are ready.”

India was Iran’s top oil client after China, but halted imports after Washington withdrew waivers to eight nations May, including India, who were earlier allowed to import Iranian oil, according to Financial Tribune.

Naftiran Intertrade, a Swiss subsidiary of National Iranian Oil Company, holds a 15.4% stake in Chennai Petroleum Corporation, a subsidiary of India’s biggest state-owned refiner Indian Oil Corp Ltd. Indian Oil has about 52% share in the refinery.

Chennai Petroleum plans to invest 356.98 billion rupees ($5.1 billion) to replace the 20,000 bpd Nagapattinam refinery in Southern Tamil Nadu state with a 180,000 bpd plant.

Chegeni said he hopes Bank Pasargad, a major Iranian bank that offers commercial and retail services, will soon open a branch in India and deal directly with India’s UCO Bank and IDBI Bank Ltd that were handling India’s oil payments in rupees to Tehran.

India was paying for oil imports in rupees before suspending its purchases due to the mounting US pressure.

The envoy also alluded to the possibility of using barter, rupee and European mechanisms for oil trade with India and other countries to skirt the US sanctions.

US Assurances

His remarks assume significance as they come days after US Secretary of State Mike Pompeo had assured India that America is "doing everything" to ensure crude oil imports to New Delhi in the wake of the situation arising out of sanctions on importing oil from Iran.

Pompeo had said India has made "hard choices" to cut off oil imports from Iran.

"India is a friend forever. We understand that India will act according to its national interest. India will follow its national interest. That is acceptable for everybody," Chegeni said.

"We think India is under pressure, but we believe India is a friend of Iran. India's relations with other countries do not affect us. Our relations with India are based on history; it is based on long-term mutual benefit and interest," the envoy added.