NEW DELHI (Reuters) – Kuwait's oil firms are close to picking up a stake in an oil asset in India, the country's oil minister said on Friday even as Indian Oil Corp. offered stakes in a petrochemical plant and an upcoming refinery.

Sheikh Ahmad al-Fahd al-Sabah did not give details but said talks had been positive and an announcement was expected "very soon."

Earlier, chairman of state-run Indian Oil Corp (IOC) said his firm had offered Kuwaiti oil firms the chance to invest in a new petrochemical plant at Panipat in northern India, and a new refinery at Paradip on the eastern coast.

"I believe we are at an advanced stage. I think it's getting a positive signal, very soon we will have a joint project here and also in Kuwait," Sheikh Ahmad, who is in New Delhi as part of a delegation traveling with Kuwait's emir, told reporters.

The minister said on Thursday Kuwait was interested in investing in existing refineries in India as it wanted to cater to the local market, and most new refineries being set up in India were primarily aimed at the export market.

OPEC members, particularly those in the Persian Gulf, have been actively investing in Asian refineries for decades, and the trend has gained urgency in recent years as producers seek firmer guarantees for future demand for their crude.

Fast-growing consumers like India, already 70 percent reliant on imported crude, are equally anxious to lock in secure supply sources, although New Delhi has been more reluctant than Beijing to bring outside investors into its upstream sector.

Saudi Arabia already has a stake in one major Chinese refinery project and is in talks for another, while Kuwait last year announced plans for a major venture with PetroChina.

Slow off the ground

In India, however, years of discussion with a host of potential investors have come to naught, as partners could not agree on a deal.

India's control of retail fuel rates -- a cap which cost refiners billions of rupees as pump prices lag far behind soaring global crude prices -- have also turned off international companies like BP, which quit a joint venture in March.

But analysts said a rapidly expanding economy and reliance on imported oil has prompted both investors and the government to gradually change their stand.

"We have talked about inviting investments in the Panipat cracker and Paradip refinery. These are the two opportunities they (Kuwait) can consider," IOC Chairman Sarthak Behuria told reporters after meeting Kuwait's oil minister.

Shares on IOC ended 8.58 percent higher at 399.80 rupees in a firm Mumbai market which closed up 3.6 percent.

The refiner in May doubled the capacity of its Panipat refinery to 240,000 barrels per day at a cost of $940 million. A $1.1 billion petrochemicals unit is being set up at Panipat to make paraxylene and purified terephthalic acid (PTA).

In April, IOC's board approved plans to build a new 300,000-bpd refinery at Paradip, in Orissa.

Kuwait said if it acquires a stake in an Indian refinery it will ensure long-term crude supply as Asia's third largest economy buys nearly 10 percent or 270,000 bpd of its oil needs from the Persian Gulf state.