New Delhi says it knew that US President Donald Trump Administration would withdraw from the nuclear deal and reimpose sanctions. So, it started to put in place a Special Purpose Vehicle (SPV) to make sure its trade ties with Iran are secured.
India says it’s own Special Purpose Vechicle (SPV) has already been in place and is fully functional in trade ties with Iran.
“We in India have already put in place an SPV and are already using it,” Indian Ambassador to Iran Gaddam Dharmendra told a joint Iran-India business forum that was held at Iran Chamber of Commerce, Industries, Mines and Agriculture (ICCIMA) on Wednesday.
“So, what we did was that we took the last template that we had in terms of our trade with Iran. Then we redeveloped it to see how we can use that mechanism to use a Special Purpose Vehicle to facilitate and accelerate our business relations,” he added, explaining how the payment channel was created.
“We had very tough negotiations with the US authorities to make sure that our business relations is secured,” Dharmendra stressed.
Ha noted that structure gives the business community in both countries the opportunity to be linked with UCO Bank and IDBI Bank to be encouraged to do trade with Iran.
“Both of our SPVs are well aware of the items that can be traded,” the Indian envoy stressed.
On the sidelines of the forum, the Indian ambassador told the Iran Chamber Newsroom that the SPV has been already working during the last six months.
Head of the Indian diplomatic mission in Iran also highlighted how his country has been in “tough negotiations with the US authorities to keep India-Iran trade relations intact.”
The Indian offical also said that New Delhi is in talks with US authorities to secure another Iran oil import waiver in a bid to meet its rising energy demand. "Not many people are aware of the fact that two of the Indian refineries are only matched with Iranian crude, that is their only feedstock is the Iranian oil," he stressed. The first round of waivers, also known as significant reduction exception (SRE) expires around 4 May.
"In these difficult times, you have a reliable frined in India," Dharmendra reassured the tradesmen and women.
UCO Bank should open a branch in Iran
Director General of Indian Affairs at Iran Foreign Minsitry Bani Asadi urged the UCO Bank to take more tangible actions to make sure Iranian and Indian exporters and importers can have a facilitated trade. “It´s not enough that UCO Bank have a representative in Iran, they should open a branch in our country,” he said, referring to Sabeer Nazeem, Chief Representative of the UCO Bank in Iran.
Bani Asadi also criticised the Indian bank for delaying in clearing the payments and thus causing problems for the two countries´ tradesmen. “That’s why the IDBI Bank came into the scene as well,” he said, explaining why there are two banks that are now carrying out banking transactions with Iran.
The Iranian official also noted that two other Indian banks are already in talks to “enter the market”.
Provincial trade capacities
Iran Chamber of Commerce Deputy for International Affairs, Mohammad Reza Karbasi also proposed that two countries’ authorities use trade capacities in their provinces in a bid to hit the 30 billion dollar target of their bilateral trade volume.
Currently, Iran’s trade with India stands at 18 billion dollars, 1.4 billion of which comes from Iranian non-oil exports. The remaining are Iran’s oil and gas products, according to the officials.