NEW DELHI: India on Tuesday kept open the option of purchasing oil from Iran, with foreign minister Sushma Swaraj informing her visiting Iranian counterpart Javad Zarif that New Delhi will take a decision after the national polls come to an end on 23 May.
Zarif arrived in India, one of the biggest buyers of Iranian oil, on Monday amid rising tensions in the Gulf following the US withdrawal from the 2015 Iran nuclear deal and re-imposing sanctions on Tehran aimed at bringing it back to the negotiating table on its nuclear programme. Washington has despatched an aircraft carrier and stealth bombers to the region triggering fears of a conflict breaking out.
According to Iran’s Mehr news agency, Zarif “evaluated his meeting with his Indian counterpart ‘positive and constructive’."
“India is consistent with Iran in many areas and such bilateral dialogues and exchanges are absolutely necessary for strengthening relations between the two countries," Zarif was quoted as saying. Another Mehr news report quoted Zarif as saying Iran and India had “designed a special financial system to augment trade and economic cooperation", without elaborating.
Swaraj conveyed to Zarif that on the question of purchasing oil from Iran, India will take a decision after the elections come to a close on 23 May “keeping in mind our commercial considerations, energy security and economic interests", according to two people familiar with the developments.
One of the people cited above said Zarif’s visit took place at Tehran’s initiative “to brief India on the Iranian approach to the recent developments in the region, including on the JCPOA (Joint Comprehensive Plan of Action) and to review bilateral cooperation."
“This was part of their consultation with other countries in the region including Russia, China, Turkmenistan, and Iraq over the last few days," the person said.
The JCPOA is the formal name for the Iran nuclear deal concluded between Iran and the P5+1 —China, France, Germany, Russia, the UK and the US in 2015. It ended years of sanctions against Iran’s nuclear programme. Last year, however, US President Donald Trump pulled his country out of the deal and announced strict measures against any country or entity doing business with Iran from 4 November. To reduce Iran’s crude oil exports—the mainstay of the Iranian economy —to zero, Washington ended on 2 May waivers that had allowed the top buyers of Iranian oil—including India —to continue their imports for six months.
According to a Reuters report, the US sanctions have already more than halved Iranian oil exports to 1 million barrels per day (bpd) or less, from a peak of 2.8 million bpd last year. Exports could drop to as low as 500,000 bpd from May, an Iranian official was quoted as saying by Reuters.
In retaliation, Iran last week said it was partially withdrawing from the nuclear deal—keeping its excess enriched uranium and heavy water, rather than sell it to other countries as previously agreed to, in a bid to limit its stockpile. Iran has also threatened to block the Straits of Hormuz, a key transit channel for exports of crude from countries like Saudi Arabia and the United Arab Emirates.
In his talks in New Delhi, Zarif “recalled the steps announced by President Hassan Rouhani on 8th May including decisions linked to the export of enriched material and heavy water," the second person cited above said. “He mentioned that 60 days timeline has been given to EU-3 and other parties to JCPOA for restoring the oil and banking channels," the person said referring to the time given by Tehran to the UK, France and Germany to persuade Washington.