India c.bank to stop clearing Iran oil payments

Reuters: India’s central bank will no longer help facilitate payments for imports of Iranian crude, a statement from the Reserve Bank of India said.

By Nidhi Verma and Rajesh Kumar Singh

NEW DELHI, Dec 24 (Reuters) – India’s central bank will no longer help facilitate payments for imports of Iranian crude, a statement from the Reserve Bank of India said.

Indian oil imports payments to Iran will have to be settled outside the existing Asian Clearing Union (ACU) mechanism, which involves the central banks of India, Bangladesh, Maldives, Myanmar, Iran, Pakistan, Bhutan, Nepal and Sri Lanka, the bank said in a statement.

“It has now been decided that payment for import of oil and gas should be settled in any permitted currency outside the ACU mechanism,” the statement said.

For the full notification see: here

Indian oil industry sources said the change notified by the RBI could hurt their imports as it would force NIOC and Indian firms to find a common platform — probably a European bank — for settling trade, instead of the central banks. (Editing by Jo Winterbottom)