Iran turns to traditional partners as EU tarries on bypassing US sanctions
Foreign Minister Mohammad Javad Zarif says Iran is working with its traditional partners such as China, Russia and India to circumvent the US sanctions.
Zarif told reporters in New Delhi Tuesday that the European Union is moving more slowly than expected to facilitate non-dollar trade with Tehran through a mechanism called the special purpose vehicle (SPV).
"We continue to work with the Europeans for the special purpose vehicle but we will not wait for them [to act]," said Zarif who arrived in the Indian capital late Monday for a three-day visit.
"We are working with our traditional partners like India, China and Russia so that we continue to serve the interests of our people," he added.
EU foreign policy chief Federica Mogherini said last Wednesday that efforts to implement the special purpose vehicle for trade with Iran would continue well into 2019.
So far, the Europeans have defaulted on two deadlines which they had announced for bringing the SPV into operation. The vehicle purportedly aims to ensure economic benefits for Iran from staying in a 2015 nuclear deal after President Donald Trump recanted it in May.
Earlier this month, New Delhi exempted rupee payments by Indian Oil Corp to Iran for crude oil imports from steep taxes.
“Iran has been and will be a reliable source of oil supply to India,” Zarif said on Monday as he arrived in New Delhi to take part in an annual research forum attended by economists and entrepreneurs.
India’s Union Minister Nitin Gadkari said after a meeting with Zarif Tuesday that Iran's Bank Pasargad will open a branch in Mumbai within the next three months to process mutual transactions.
The Iranian oil money is currently being kept in India’s government-owned UCO Bank in the Indian currency, which has led to a debt buildup because of the US sanctions.
Zarif said there were numerous areas of cooperation for boosting ties, one of them being Iran’s strategic port of Chabahar. “Indians are keen on being present in Chabahar as well as in Iran’s transit infrastructure,” he said.
Gadkari said India was hoping to fully operationalize Chabahar, with the Bank Pasargad branch in Mumbai intended to handle the related transactions.
Gadkari said the financial arrangement for Chabahar was also ready and proposals on a mutual barter system could also be considered.
India, he said, can provide steel rails and locomotive engines to Iran, and receive urea in return.
Zarif also noted that he was negotiating higher urea sales at "reasonable" rates with Indian officials.
"We are very happy that both UCO Bank of India and Pasargad Bank of Iran are getting started with the business," the Iranian minister said, adding the two banks will facilitate transactions relating to operation of berths at Chabahar Port.