India to pay Iran USD 400 mn in past oil dues

After clearing USD 1.65 billion in past oil dues, India will in next few days pay another USD 400 million to Iran.
Indian refiners had in June-July paid USD 1.65 billion to Iran to clear more than one-third of the over USD 4 billion in past dues that had accumulated.
They will now pay another USD 400 million by Monday/Tuesday, sources said.
Under an interim deal with the US and five other world powers, Iran won access to USD 2.8 billion in past oil revenue from a number of countries including India. This is in addition to USD 4.2 billion that it got from its customers during January to July.

Sources said Indian refiners had paid the previous USD 1.65 billion in three equal installments of USD 550 million each - first on June 26, second on July 8 and third on July 24.
Since February 2013, when the US blocked payment channels to Iran for its nuclear programme, India has been paying 45 per cent of its Iran oil bill in rupees through a UCO Bank branch in Kolkata. For the remainder, it had been waiting for a way to make the payment.

As much as USD 4 billion had been accumulated in past dues.
Sources said the payment mechanism used in June/July will again be used to clear USD 400 million dues.

Rupee payments equivalent to USD 400 million will be deposited by Indian refiners in the Uco Bank account, which will now be transferred to the Reserve Bank of India for onward credit to the central bank of the United Arab Emirates, which will make payments in dirhams to Iran.
Iran is seeking interest on the pending dues. However, the Indian government and the RBI have rejected the request, saying they had always been ready to make timely payments but the problem of mode and channel were due to Iran.
Since July 2011, India had been paying in euros for 55 per cent of its purchases of Iranian oil through Ankara-based Halkbank. The remaining 45 per cent was remitted in rupees through Uco Bank.

The euro payments ceased from February 6, 2013, but the portion of rupee payments continued through Uco Bank.