India did not act under pressure on transactions with Iran: MEA | india | Hindustan Times
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India did not act under pressure on transactions with Iran: MEA

Dismissing reports that it was acting under pressure, India on Friday termed as "technical" the problem in settling the current account transactions with Iran under the Asian Clearing Union (ACU) and said efforts were being made to resolve the issue as soon as possible.

india Updated: Dec 31, 2010 19:54 IST

Dismissing reports that it was acting under pressure, India on Friday termed as "technical" the problem in settling the current account transactions with Iran under the Asian Clearing Union (ACU) and said efforts were being made to resolve the issue as soon as possible.

"We have seen reports regarding problems with respect to settlement of current account transactions with Iran under the Asian Clearing Union mechanism.

"This is a technical issue and the Reserve Bank of India is seized of the matter. Efforts are being made to resolve the issue as soon as possible. There is no question of India acting under pressure of any country," the External Affairs Ministry said.

The RBI had on December 23 said that companies will be allowed to settle current account and trade transactions with Iran outside ACU, a regional payment arrangement.

This dismantled a mechanism used to complete payments for oil. Participants in the ACU settle transactions in either US dollar or euro.

Iran has refused to sell oil under the new rules.

Reports had said that the RBI move was influenced by the US as till 2008, payments under the ACU mechanism was done in US dollars but after Washington imposed sanctions against Iran over its suspected nuclear programme, the currency shifted to Euro.

United Nations sanctions do not forbid buying Iranian oil and recently the European Central Bank (ECB) asked RBI to provide certificates that the Euro being used to import products are not on US sanctions list. ACU, based in the Iranian capital Tehran, settles trade transactions from Bangladesh, Bhutan, India, Iran, Nepal, Pakistan, Maldives, Myanmar and Sri Lanka.

In absence of a mutually acceptable payment mechanism, India may not be able to import 10 million barrels of crude oil contracted from Iran in January 2011.

India imported 21.3 million tons of crude oil from Iran in 2009-10 and this year imports are expected to be around 18 million tons as Reliance Industries has totally stopped using crude oil from the Persian Gulf nation.