Kolkata: United States (US) Secretary of State Hillary Clinton is warning India lawmakers to back off Iranian oil or face possible sanctions from the United States.
U.S. Secretary of State Hillary Clinton arrived in the eastern city of Kolkata on Sunday, the same day when a trade delegation came from Iran, with which Washington wants New Delhi to reduce its commercial ties, especially in energy.
India has huge energy needs to fuel its rapid growth and has made some progress in easing its dependence on Iranian oil. But a senior US official said the United States wants to see more.
The official, who spoke on condition of anonymity to preview Clinton’s private discussions in Kolkata and New Delhi, said the “trend lines are good” but “we really need to receive assurances that they are going to continue to make good progress.”
Like other major consumers of Iranian oil, India could face US sanctions by the end of June if the Obama administration determines it has not made significant cuts in imports under a law aimed at squeezing Iran’s petroleum industry to press the country to comply with international demands over its nuclear program.
A dozen European nations and Japan have already been spared from those sanctions after the administration determined they had substantially reduced their Iranian oil imports. India, along with China, South Korea, Turkey and South Africa, has still not received such waivers.
India imports around 70 percent of its oil, and about 9 percent of the imports are from Iran. The US official said India had recently stepped up imports of oil from Saudi Arabia to make up for the reduction in Iranian oil and that the US was eager to see the Indians explore other alternatives. Iran is India’s second-largest crude oil supplier after Saudi Arabia and according to media reports imports 550,000 barrels a day.
India has been pushing its oil companies to cut back their crude imports from Iran and an Indian official, speaking on condition of anonymity per custom, said the government is willing to discuss the matter. The official expressed hope India will be exempted from the sanctions.
“We believe we have a strong case, which we will put forth,” the official said.
But, in an indication of India’s multi-directional interests, a large Iranian business delegation arrived here to hold talks with their Indian counterparts on ways of beating U.S. and European restrictions on trade with Iran. Under a deal, India will pay for about half of its Iranian oil purchases in rupee. This could be utilised by Tehran to buy Indian goods. An Indian delegation visited Iran in March to showcase its products. But both sides realised that some level of two-way trade was necessary to sustain the arrangement; this led to the Federation of Indian Chambers of Commerce and Industry to invite their Iranian counterparts at a time when the manufacturing sector is experiencing a sluggish growth.
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