Confederation of Indian Industry (CII) plans to open office in Tehran next year, the Indian ambassador to Iran says.
“We are now looking forward to this office in Tehran by spring of next year,” Saurabh Kumar said in an exclusive interview with the Tehran Times on Wednesday, November 9.
Ambassador Kumar said it will be CII’s 10th international office.
The Indian envoy also said a “Chabahar specific event” will be held in Iran this year or early next year to familiarize Indian stakeholders, people from shipping, industry, trade, commerce, freight forwarders and others about Chabahar Port.
Below is the entire text of the interview.
Q. Could you please shed light on the latest development of the long-proposed and ambitious Iran-India undersea gas pipeline project?
A. Let me take a step back and start by telling you that hydrocarbon sector, oil and gas, is a major area of cooperation between the two countries. As you are aware, we buy a lot of crude from your country and after January, after the Implementation Day, we have been sourcing more and more of that crude from Iran. In December last year, we had a meeting of what we call a working group in the hydrocarbon sector between India and Iran, and what was decided in that working group meeting is that we look forward to enhancing our relationship in this area which would also involve looking at Farzad B gas field which was discovered by Indian company ONGC.
As far as transportation of gas is concerned all possibilities are on the table. This might include LNG (liquefied natural gas) this may include gas pipeline, overland gas pipeline, subsea gas pipeline. So these are really techno commercial issues. We have to see technological feasibility and commercial viability and whichever option is the best option, we’ll be ready and happy to consider it.
The subsea pipeline which you spoke of has been spoken of in the past. Some work has been done on it and it’s definitely one of the options for transportation of gas from Iran to India. But on a larger plane what we’re looking at is that we want to take our relationship in this very important sector of our cooperation from that of a buyer and seller to a comprehensive partnership.
Just now you’re selling crude to us and we’re buying your crude. We want to evolve this into a more comprehensive partnership with investments from India out here. Farzad B is a possibility; we look forward to Iranian investments in Indian refinery sector. There is not only the upstream sector but also the downstream sector which we are eager to look at. So we want to take the relationship into a more comprehensive partnership in the hydrocarbon sector both upstream and downstream.
Q. Has the implementation of the Joint Comprehensive Plan of Action (JCPOA) eased the trade between the two countries at all? Has the volume of trade increased following?
A. The JCPOA offers new opportunities to both countries. The restrictions of the past have been removed. To give one example, Iran can now receive through banking channels in hard currency payments for the crude it sells to India. Crude, as you know, is the major item in our bilateral trade basket. This is a direct benefit of the JCPOA. As I have mentioned above, we are importing more crude from Iran now. In volume terms, the trade is going up. However, because of depressed crude prices, in dollar terms the trade figures show a decrease.
Q. How much of the outstanding India’s oil debt to Iran, amounting to 6.4 billion dollars, has been cleared?
A. As you would be aware, we continued our trade relationship with Iran even while the sanctions were there. We, meaning India and Iran together, had put in place a mechanism to facilitate payment for the crude we were buying. We called it the 55-45 mechanism, where 45% of the crude payments were made in Indian rupees and kept in Iranian accounts with Indian bank, and 55% was in hard currency in euros. So, as soon as the banking channels opened for crude sales, we started paying back the 55%. I think there was a total of 6.2 billion dollars of which close to 4 billion has already been paid. All the Indian government oil companies which were importing from Iran have more or less paid up of what was due.
A little bit remains and that is a matter of technicality and we will sort it out. As far as 45% was concerned, that was very helpful because Indian companies utilized that money to export to Iran so that our trade did not suffer. So that was the mechanism that we were using. But now, of course, with the sanctions easing and new opportunities opening, both countries are looking forward to utilizing these.
Q. How is India planning to pay the remaining portion of its debt to Iran?
A. As I told you of the total amount of 6.2 billion dollars some 3.6 billion has already been paid. With the Indian oil companies very little amount remains. The major balance of 2.6 billion or so remains with a private Indian company. They have been in touch with the authorities out here and they have an understanding on how this money is to be repaid or the time frame over which it would be repaid. We hope that this money would be repaid quickly and the matter is sorted out. The money is yours and it has to come back.
Q. There are regional equations that cannot be overlooked such as terrorism and extremism which pose the most pressing threat to humanity. In your opinion, how Iran-India relations can help eradicate terrorism?
A. Terrorism is a very serious concern for entire humanity. It is a serious threat in the region in which you are located and equally in the region we are located. We have to seriously consider as to how to combat this menace. It affects all of us. The Government of India sincerely believes and has articulated that there are no good and bad terrorists. Terrorism can affect anybody anytime. So all of us have to be united and have to adopt a comprehensive approach in dealing with terrorism.
What we have done, and the initiative that is still on the table, is that in the United Nations some years ago we had moved a draft convention on terrorism called CCIT – Comprehensive Convention on International Terrorism. There has been some progress, but there are some challenges which remain. We hope that this convention is passed sooner rather than later. It would provide a legal framework for addressing this menace.
I think our two countries can cooperate in this area. I need to mention here that we have a very good dialogue with your country. It’s a longstanding dialogue between the national security councils of our two countries where we share views as to how to tackle security challenges and terrorism is one of the issues which we discuss.
Q. Can Iran-India ties be affected by the next American president’s policy?
A. Relationship between Iran and India is not dependent upon either your relations with anybody else or our relations with anybody else. That is the short answer. As far as our relations are concerned it doesn’t matter. Our relationship will continue to grow.
Q. Do you believe the tension between Pakistan and India requires a mediator like Iran, which has established friendly and amicable relations with both states, to step in and help resolve the conflicts between the two states?
A. We believe that it is best for India and Pakistan to undertake a bilateral dialogue to resolve the issues which are there between the two countries. We have elaborated frequently that we are ready to do that, and we are ready to undertake discussions. The short point is that terrorism tends to push dialogue into the background. We would like dialogue to be in fore-front and through dialogue resolve whatever issues are there between the two countries.
Q. Back in May of this year, Iran and India held a one-day joint naval drill in waters to the east of the Strait of Hormuz. How significant are such exercises for the states?
A. In May, we had the visit of naval ships to Bandar Abbas. The ports of call by naval ships of Iran to India and India to Iran have been taking place for some time. We attach a lot of importance to these exchanges because both of our countries believe that maritime cooperation is an important area for us. So when our naval ships were here in Bandar Abbas in May, there was the usual drill which takes place when there are ports of call. While the ships were sailing out PASSEX maneuvers were conducted. The larger point is that we’ve had naval exchanges and we attach importance to these exchanges with Iran.
Q. The story of an Iranian-British girl Narges Kalbasi Ashtari has made headlines in Iran these days. Ashtari is in India now awaiting her trials for a crime she never committed. What can you and your government do to help solve her case and guarantee her safe return home?
A. Trust the Indian judiciary and Indian institutions. Things will work themselves out. The process is underway. Independence of judiciary is an important pillar of Indian State. Today, if you tell me to do something it would be very difficult, because there is a judicial process underway. Let that judicial process do the work. I think justice will be meted out and there won’t be any cause for concern. But for the executive to intervene in the judicial process is not possible within our system. I have conveyed the sentiment here to my government. We will do our best.
Q. Last year, Iranian students studying in India faced difficulties attributed to the Indian laws and academic procedures. Could you elaborate on what the problem was?
A. This is not as big an issue as one perceives it to be. A lot of Iranian students and students from different countries and different parts of the country get admitted for pursuing medical and dental studies in India. The admission process for medical and dental degrees had gone to the Supreme Court of India and the court gave a judgment that all students who join dental and medical studies need to qualify a particular examination. Now, there were certain doubts whether foreigners are included in this or not. One of the institutions which has foreign students went to the Supreme Court which gave an affirmative ruling which is now final and it cannot be challenged and the government of India has to abide by it.
So from now on, all the foreign students who are admitted for medical and dental studies would have to write this examination. This is not from retrospective effect. So the students who are already studying would continue studying. Only those students get affected are who are going this year. So we have some students who are already in India who were given admission or were promised admission but now because of this ruling they will have to write to this exam.
So, this is not typical to Iran, this involves all foreign students who might have gone to India for medical or dental studies. And from next year onwards we would have a system where foreign students would need to write this exam and get admitted to medical or dental schools.
Q. How can the two countries enhance cultural exchanges and academic relations including exchange of journalists, students, visiting professors and such?
A. Our two countries have had historical, cultural and people to people links. There is, however, the need to develop institutional cooperation and have greater people to people exchanges. The Cultural Exchange Programme signed during the prime minister’s visit in May provides for this. We are looking forward to implementing this in a comprehensive manner. There are several thousand Iranian students studying in India and we know of some students from India studying in Iranian universities. This, however, needs to be further increased. The science and technology dialogue between our two countries would provide for this including exchanges at the academic level. We are trying to schedule the S&T (Science and Technology) dialogue in December.
Q. What are the newest and latest developments between Iran and India?
A. As you know the prime minster visited your country in May. It was a very successful visit. He had good discussions with the Supreme Leader and president, and several important agreements were signed.
One of the important agreements was the Chabahar Port Contract. Chabahar was something which was discussed for a long time, but during the prime minister’s visit, we concluded the contract, and now within the time period which is provided in the contact, which is around two years, phase one of Chabahar Port would be completed.
Trilateral transit cooperation between Iran, India and Afghanistan was the other really significant agreement signed. And then of course, we had several other agreements in the economic and other functional areas.
Minister Akhondi was in India in the end of September and the objective of his visit was to look at progress on Chabahar related matters and also discuss other connectivity and infrastructure development issues and collaboration between the two countries.
One of the outcomes of the visit was that we are looking forward to a Chabahar specific event in Iran later this year or perhaps early next year. The idea is to familiarize Indian stakeholders, people from shipping, industry, trade, commerce, freight forwarders and others about the Chabahar Port. So this would be a big event. We are also looking forward to officials who would be dealing with connectivity related matters like customs, transportation from the two countries and Afghanistan to meet to discuss these issues.
We are trying to put in place three important agreements in the area of trade and economic cooperation. One, we are discussing a preferential trade agreement or PTA.
Second is a double taxation avoidance agreement. The text of double taxation avoidance agreement is almost ready and we need one more round of talks to have the agreed text.
Third is the bilateral investment agreement. With investments coming from India and vice-versa we need a bilateral investment treaty or BIT. So we have had one round of talks and we are looking forward to having more talks.
Another significant development is that before the prime minister’s visit, the counterpart of Iran Chamber of Commerce which is CII, Confederation of Indian Industry, sent a delegation led by president of CII or who is a very eminent business man of India, Mr. Naushad Forbes. He came here with a group of chief executive officers of companies and they had discussions with various government departments. They met Minister Nematzadeh also.
The important point is that CII decided to open its 10th international office in Tehran. They don’t have too many offices. We are now looking forward to this office in Tehran by spring of next year. This would be an important development because you would have an Indian Chamber of Commerce represented in Tehran and that would facilitate industry links.
In the hydrocarbon sector, we are undertaking discussions on Farzad B and these are at a crucial stage. In fact, we have a team of our experts from geological and related area that carried out discussions. So technical and commercial discussions are underway.
When the prime minster was here he invited President Rouhani to India and he accepted the invitation. We look forward to a return visit.