The Reserve Bank of India's move to ban oil companies from using the Asian Clearing Union (ACU) to process the current account transactions for oil and gas imports from Iran will impact India's development plans.

However, almost all other oil and gas exporting countries are using the U.S dollar for their transactions and are out of the ACU.
The fact is that there are no UN sanctions on transactions of oil and gas from Iran and if there were to be one, it would fail as European countries and China are unlikely to comply. India maintains that it has civilization links with Iran, but is seen to be buckling down under U.S. pressure.
We have already given up on Iran gas pipeline with or without Pakistan and are looking at a more unsafe, less feasible and more difficult Turkmenistan-Afghanistan-Pakistan-India (Tapi) pipeline. It would hurt national interests further if we were to lose Iran as a stable and continuing source of supply of oil and become entirely dependent on Arab world.
At present, we import nearly 75% of our crude requirement and of this, nearly a quarter comes from Saudi Arabia, 10% each from the UAE and Kuwait. Imports from Iraq are likely to reach the level of Kuwait in some time. For various reasons, we have consciously pursued diversification of sources of supply, moving to Nigeria and Venezuela. But to lose Iran that accounts for 12-14% of imports would be a big blow to our efforts.
We lost to China the chance of bringing gas from Myanmar. Losing oil and gas supplies from Iran will hit our interests hard. The seat on UNSC is still distant and elusive, but energy insecurity is real and immediate. We cannot grow without energy. Our per capita energy consumption is around one-fourth of the world average and denying ourselves access to Iran hydrocarbons is imprudent.
What we need is to put together an arrangement that takes care or 'circumvents' the financial sanctions. Our PSU and private sector companies should work ingeniously to develop such arrangement even if it has to be outside the ACU or with the help of third country financial systems.
(Source: The Economic Times