|India extends export benefits to rupee trade with Iran||
Exports to Iran in Indian rupee will also be entitled for trade benefits as available to exporters realizing proceeds in freely convertible currencies.
“Export proceeds against exports to Iran realized in Indian rupees are permitted to avail exports benefits/ incentives under the Foreign Trade Policy, 2009-14, at par with export proceeds realized in freely convertible currency,” the Indian director general of foreign trade has said in a notification.
Indian exporters mainly trade in freely convertible currencies including U.S. dollar and euro. The government provides export incentives under different schemes, including Focus Market Scheme, to exporters realizing their proceeds in such currencies.
Iran makes payment in rupees to Indian exporters after the Western countries imposed sanctions on it.
To increase bilateral trade, the Indian government in April had also waived the value addition norms for exporters shipping imported items like food and pharmaceuticals to Iran.
Besides food products, India mainly exports to Iran pharmaceuticals, machinery, transport equipment, chemicals, man-made yarns and fabrics, and steel.
The bilateral trade between the two countries stood at $15.25 billion in 2013-14.
India is one of the biggest oil importers from Iran.
Since February 2013, when the U.S. blocked payment channels to Iran for its nuclear program, India has been paying 45 percent of its Iran oil bill in rupees through a Uco Bank branch in Kolkata.
India has steadily cut imports from Iran as the sanctions from U.S. and other Western countries blocked payment channels and crippled shipping routes.
It imported 21.20 million tons of crude oil from Iran in 2009-10, which came down to 18.50 million tons in 2010-11 and 18.11 million tons in 2011-12.
Crude oil imports from Iran were reduced to 13.14 million tons in 2012-13, the year when the U.S. had tightened sanctions on Iran.
(Source: Business Standard)
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