In a bid to promote two-way trade with India, Iran is exploring an alternative banking mechanism within the framework of the international law, Iran’s foreign minister Hossein Amir-Abdollahian said on Thursday.

“I had a fruitful discussion with Senior Ministers of the Indian government to establish such a banking mechanism,” the foreign minister said speaking at an interactive meeting organised by MVIRDC World Trade Center Mumbai – an international trade promotion organisation and All India Association of Industries (AIAI) – an industry body.

Both the sides discussed the possibility of rupee-rial trade and agreed on a conducive legal mechanism to promote two-way commerce, he said. A Memorandum of Understanding was also signed between the West Asian nation and World Trade Center Mumbai to promote bilateral trade and investment as also with All India Association of Industries.

Apart from establishing a banking mechanism, the two countries have also explored the possibilities of settling trade transactions in rupee or through barter system, said the minister, who is on a three-day visit to India.

Within the framework of international law, there are existing banking mechanisms which Iran has already implemented with a dozen countries, the minister said.

The two countries have also agreed to ‘‘precipitate’‘ investment in the Chabahar Port which has already commenced operations with investment support from Asia’s third largest economy. To supplement the port activities, Iran has also activated North-South and East-West Transit Corridors to support trade with other countries, the minister said.

Speaking at the session, Iran’s Deputy Minister of Judiciary, Fattah Ahmadi, said, “Iran is clear in its intention to support trade and investment ties with India by signing an agreement on mutual legal assistance in civil and commercial matters.”

The two Iranian ministers also invited Indian companies to explore trade and investment opportunities in Iran by assuring that its government will provide a conducive business environment to protect their commercial interest.

Earlier, in his welcome remarks, Vijay Kalantri, Chairman, MVIRDC World Trade Center, Mumbai, and President, All India Association of Industries (AIAI), said, “Currently, the bilateral India-Iran trade is hardly $2 billion; but there is untapped potential to raise it to as much as $50 billion if both the countries launch rupee-rial trade or barter trade that can reduce transaction cost and increase volume of trade.”

Kalantri also suggested exploring preferential trade agreements to provide fillip to bilateral trade and investment.