Washington: Despite India's assertion that it will not scale down its petroleum imports from Iran, lawmakers in Washington have been told by a Congressional report that India is "cautious" on any expansion of energy relations with Iran.
"Since late 2010, India suggested that it was cautious about any expansion of energy relations with Iran," the independent Congressional Research Service (CRS) said in its latest report on Iran.
Earlier this week, Indian Finance Minister Pranab Mukherjee had said in Chicago that New Delhi will not curtail its petroleum imports from Tehran despite US and European sanctions against the Islamic republic.
"It is not possible for India to take any decision to reduce the imports from Iran drastically, because among the countries which can provide the requirement of the emerging economies, Iran is an important country amongst them," Mukherjee had said.
CRS, the independent bipartisan wing of the Congress, prepares periodic reports on issues of interest to the lawmakers.
Prepared by independent experts, these reports are not an endorsement by the Congress, but puts things in perspective from the American point of view for the lawmakers to make their own informed decisions.
"Previously, the threat of imposition of US sanctions had not dissuaded Indian firms from investing in Iranian energy projects," said the report referring to the recent statement by the Indian Ambassador to the US, Nirupama Rao, that India's purchase of oil from Iran has dropped in recent years.
"India appears to be moving toward the US and EU position as of early 2012. The US law sanctioning dealings with Iran's Central Bank led Halkbank to express the view that it might not be able to continue handling payments to Iran, and Iran has asked India, as a possible solution, to try to pay for oil in Japanese yen," the report said.
Aside from the renewed payments dispute, Indian refiners reportedly are cutting their purchases of Iranian oil in order to receive the sanctions exemption under PL 112-81 discussed above (exemption for countries that significantly reduce oil purchases from Iran), it said.
"Perhaps because of the payments difficulties, some Indian firms, including Reliance Industries Ltd, have reduced their crude oil purchases from Iran," the report said.
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