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How India can cope with cut in Iran oil imports

Come November, India will be in a tight corner whether to cut Iranian crude or to defy US ignoring its threat of sanctions if Iranian crude import continues.

Though India has not taken any decision in this issue of serious conflicts of interest, the Indian government has asked state-owned oil firms to prepare a blueprint of alternatives sources as it considers acquiescing to U.S. President Donald Trump's demands for ending oil imports from Iran by Nov. 4, government and industry officials said today.

 

Getting a replacement for the oil needs will not be a problem as Saudi Arabia, Kuwait and Iraq would be ready with the supply; but the hitch is Iran offered some veritable commercial benefits like longer duration of 60 days for payment while the other countries could not offer so much time, to mention one benefit.

Again India’s keen interest in Iran’s Chabahar port has to be taken into account. Much effort and much money have gone into making the port operational and the media report that it will become operational soon, according to the Shipping Minister. Efforts are soon to bear fruit. Of course, India is bound by sanctions of United Nations (UN) only; but all the same the consequences of severing ties with the US could not be totally ignored.

Unlike the Obama administration when it was enough if India showed ‘significant reduction’ bringing down oil imports at an average rate of 20 per cent every six month, President Trump does not budge from zero import.

On Thursday, oil minister Dharmendra Pradhan said India will decide on Iranian imports keeping its best interest in mind. "Our basket (of crude imports) has become multi-country. There may be no country in the world that we have a problem getting oil from. We buy from Latin America, we buy from Brunei. When the US became an exporter, Indian companies were first to buy," he said.
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