india-iran

India not to tax rupee payments for Iranian oil
The payments in Rupees for oil imports from Iran have been relived by India from heavy local taxes. The Finance Bill,
part of the Union Budget pointed that the exemption in the "national interest" would be implemented from April 1,
2012. The Finance Bill therefore said: "It is therefore proposed to insert a new clause … to provide for exemption in
respect of any income of a foreign company received in India in Indian currency on account of sale of crude oil to any
person in India," subject to certain conditions, including government approval.
Objective of this Move:
 The move would assist refiners settle some of their oil trade with the sanctions-hit Iran if the current mechanism
via Turkey folds under fresh sanctions.
Backgrounder:
 India and Iran in January 2012 decided to settle 45% of oil trade in Rupees, which are not freely
traded on international markets. Iran intended to use Rupees to pay for imports from India. But
the mechanism could not kick start owing to the 40% withholding tax, which both Indian
refiners and the National Iranian Oil Co (NIOC) refused to pay on transactions.
 India’s State run Hindustan Petroleum Corporation in February 2012 held that Indian refinery firms can’t pay for
Iranian crude imports in Rupees unless the Government of India exempted them from paying the 40%
withholding tax on such payments in Rupees.
 12% of India’s oil requirements are met from Iran which is worth about $11 billion yearly. Iran is the 2nd biggest
Oil supplier to India.
 For Iran, India is the 2nd biggest client after China. Iran is currently facing sanctions from the US and the EU over
its nuclear ambitions.
Current Affairs Published on www.gktoday.in from January 1, 2012 to
September 10, 2012
At present Indian refiners are paying for their oil imports via Turkey’s Halkbank, but refiners fear this system may fall
foul of the new sanctions being imposed. If the Budget is passed by the parliament, Indian refiners can pay 100% via
the Rupee mechanism if in case the Turkey route ends.





Soyameal imports: India, Iran ink deal
Iranian and Indian traders inked contract to purchase 1.25 lakh tonnes (LT) of soyameal, used as animal
feedstock, at $430-435 per tonne. The consignment will be delivered during April-May period 2012.








Payments in Rupee accepted by Iran
The longstanding issue over the payments for export shipments has been resolved amidst India and Iran. Both the nations have accorded to admit payment in Rupee form, an act that could disengage vast sums pending on both sides.The payment problem with Iran has been resolved with operationalization of the rupee payment mechanism through UCO Bank.
An Indian delegation will visit Iran from March 10, 2012 to March 14, 2012 in order to tap the potential arenas where India could become a partner or a stakeholder.





India not to stop importing oil from Iran
India to continue to import oil from Iran without violating any international law. India has requested the
United States and the European Union to take into account India’s oil needs.
The United States exempted Japan and 10 EU nations from financial sanctions because they have significantly cut
purchases of Iranian oil, but left Iran’s top customers China and India exposed to the possibility of such steps.









India exempted from US financial sanctions on Iran oil imports
 US exempted India and 6 other countries from financial sanctions because they have significantly cut purchases
of Iranian oil.
 The group includes India, Malaysia, South Korea, South Africa, Sri Lanka, Turkey and Taiwan.
 Japan and some of the European countries are already exempted from Iran sanctions