India raises Iran credit line to $450 million

The credit line will help in supplying steel rails to Tehran

India's cabinet on Wednesday raised a credit line to Iran to $450 million as New Delhi aims to boost trade ties with Tehran after the lifting of international sanctions.

The credit line, to be extended by the country's lending arm for the export of goods and services, will help in supplying steel rails to Tehran.

State-run Steel Authority of India Ltd and private firm Jindal Steel and Power Ltd have signed a deal with Iran to supply 250,000 tonnes of steel rails worth Rs 1,700 crores ($255 million) in 2015.

But supplies have not begun pending New Delhi's finalising of the credit line.

India's Exim Bank and a consortium of Iranian banks led by the Central Bank of Iran struck a deal in 2014 for financing exports from India worth Rs 900 crores.

The increased credit line will help Indian companies gain a foothold in Iran, the government said in a statement.

In February, India approved a $150 million credit line for the development of Iran's Chabahar port.

($1 = 66.6550 Indian rupees)