India would import 11 million tonnes of crude oil from Iran in the current fiscal, according to Petroleum Secretary, Vivek Rae.
“We were importing 21 mt of oil from Iran... If the sanctions get resolved, we can go back to 21 mt,’’ Rae told media persons on the sidelines of Energy Security Conference 2013 organised by CII in New Delhi.
Talking about the benefits to India after the recent agreement between world powers and Iran on the Islamic nation’s nuclear programme, Rae said: “Iran is a great source of oil and gas. Once the problem being faced by Iran is solved, there would be more oil and gas available in the market and there would be liquidity and prices tend to soften. As an importing country, this would certainly benefit us. We welcome any decision in the world that enhances the supply of oil and gas.’’
A delegation from India is going to Iran shortly to discuss several issues.
The Secretary further added that the sanctions will be worked out in the next six months and India will have to see how the policy regime changes. “And we will calibrate our decisions for next year based on that.’’
Insurance fund
Rae also said that if the issues get resolved, India may not need the insurance fund. The country is trying to put in place an insurance fund to cover crude oil shipments from Iran.
“We are not giving it (insurance fund) a pause. The inter-ministerial consultations are going on. After the consultations are over, then we will take a call,’’ Rae said.
Crude oil payment
Currently, India is paying only 45 per cent of payments for crude oil in rupees. The payment mechanism is based on a MoU between India’s Finance Ministry and Iran.
“Right now, 45 per cent payment is made in rupee and 55 per cent is stuck. Because, we were hoping it to be in rupee, while Iranian Government is saying it should be in foreign exchange. We probably imported $5 billion worth of crude oil from Iran. Of this, we may have to pay $2-2.5 billion to the Iranian oil companies,’’ he said.