Economy

‘India’s over $3 bn oil & gas imports from US will bridge trade deficit’

Amiti Sen New Delhi | Updated on December 27, 2018 Published on December 27, 2018

Representative image   -  Reuters

No correlation with imports of oil from Iran which will continue, say officials

India has imported oil and gas worth over $3 billion from the United States (US) in 2018 which will help bring down the trade imbalance significantly, a senior government official has said.

The country, however, will continue to import oil from Iran and there is no correlation between India's purchase from its Islamic neighbour and the US, the official added.

"It (gas and oil) is a completely new import on India's part from the US and will directly result in bringing down America's trade deficit with us. However, it doesn't mean that we will stop importing from Iran," the official told BusinessLine.

The US imposed trade sanctions against Iran earlier this year but allowed eight countries, including India, to import till the end of April 2019.

The Trump administration has been complaining about the trade deficit that the US has with India ever since it came to power and had also asked its Commerce Department to investigate the reasons behind it.

Washington also included India in the list of countries it penalised with higher import duties on steel and aluminium.

"We have lowered our trade deficit with the US in 2017 compared to the previous year. Now, with the purchase of gas from the country, the deficit is set to come down further in 2018. The US now has to recognise the sincerity of our efforts," the official said.

India recognises that the waiver from sanctions given by the US to continue purchase of oil from Iran will be reviewed in six months and its response would depend on how the situation pans out. "We will have to see what the US has to say at the end of six months. But the fact remains that our national and economic interests will keep guiding our decisions,” the officials said.

The trade deficit between India and the US bridged by almost six per cent in 2017 to$22.9 billion, according to the 'Trade Estimate 2018' released by the USTR earlier this year.

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Published on December 27, 2018
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