NEW DELHI, June 11 (Reuters) - India has offered incentives
for exports to Iran, the trade ministry announced, a step
industry officials said on Tuesday could double the country's
sales to sanctions-hit Tehran to $6 billion in the current
fiscal year that began in April.
Indian traders will now be allowed to turn around imports
and sell them to Iran, as long as they have added at least 15
percent in value to the goods, the Directorate General of
Foreign Trade, an arm of India's trade ministry, said on its
"Accordingly, exports of such goods to Iran which have been
imported against payment in freely convertible currency would be
permitted against payment in Indian Rupees also, subject to at
least 15 percent value addition," the notification said.
India is a major importer of Iranian oil but United States
and European Union sanctions, meant to discourage Tehran from
pursuing its nuclear programme, aim to curb Iran's oil revenues
and have made payments for the oil difficult.
Tehran now has to keep New Delhi's payments in
tightly-restricted rupees in an India-based account which can
only be used to buy certain goods from India.
New Delhi primarily exports rice, cereals, pharmaceutical
products, machine tools, automobile parts and steel to Tehran,
all of which are permitted under sanctions. The latest order
widens the scope of potential exports.
The increase in exports could make India a net exporter to
Iran, which used to be its second-largest supplier of crude at a
cost of over $12 billion a year before sanctions came in place.
"The move will benefit Indian exports and we can look
forward for sizeable growth in India's exports to Iran in the
current fiscal," M Rafeeque Ahmed, president of the Federation
of Indian Export Organisations (FIEO), said in a statement.
Ajai Sahai, FIEO's chief executive, said the incentives
could double exports to Iran to $6 billion in 2013/14 from a
India's move comes within a week of the United States
renewing six-month waivers on sanctions for India, China and
seven other economies in exchange for their agreement to reduce
purchases of oil from Iran.
India shipped in about 266,000 barrels per day (bpd) of oil
from Iran in the contract year ending March 31, 2013, down 26.5
percent from a year ago.