India to boost investment in Iranian oil and gas sectors

Tehran: India and Iran on Sunday decided to significantly expand engagement in their overall ties, particularly in boosting Indian investment in joint ventures in oil and gas sectors in the oil-rich nation where foreign investors from major economic powers are rushing in to get early footholds after lifting of nuclear sanctions.
In talks between External Affairs Minister Sushma Swaraj and her Iranian counterpart Mohammad Javad Zarif, the two sides agreed that pending agreements such as Preferential Trade Agreement, Double Taxation Avoidance Agreement and Bilateral Investment Treaty should be concluded on a priority basis to spur trade and investment.
Enhancing energy cooperation and development of the Chabahar port were the centrepiece of talks which was mostly dominated by economic issues.
"The talks were very successful and would give new energy to our centuries old ties with Iran. In particular, the economic partnership will get considerable fillip as a result of today’s forward looking talks," Ministry of External Affairs Spokesperson Vikas Swarup said.
Sources said the issue of Kulbhushan Jadhav was not at all raised by the Iranian side. Jadhav was reportedly arrested in Balochistan after he entered from Iran and was accused by Pakistan of planning "subversive activities" in the country.
Both sides discussed the progress on the Chabahar project and agreed that the commercial contract on Chabahar as well as the modalities for extending $150 million credit for Chabahar Port should be signed in the "very near future".
Decisions on this line of credit, as well as $400 million credit line for supply of steel rails from India have already been taken by India.
Swarup said both sides discussed the energy partnership and Iran invited greater Indian participation in its oil and gas sector.
"Iran said it would be happy to participate in the refinery sector in India." On Farzad-B oil field project, both sides took note of the constructive discussions held during the recent visit to Iran of Oil Minister Dharmendra Pradhan. "The Indian side welcomed the Iranian decision to keep the Farzad-B field outside the auction basket. The concerned companies have been directed to complete their contractual negotiations in a time bound manner. Iranian side had earlier communicated their gas pricing formula and expressed their desire for Indian investment in the Chabahar SEZ," he said.
"In terms of connectivity, Iran said it supported India’s desire to join the Ashgabat Agreement. The two ministers reviewed the progress made in the International North South Transport Corridor.
IRCON from India would be visiting Iran for discussions on the Chabahar-Zahedan Railway link," said the spokesperson.
On Trade and Investment, the two sides agreed that with the lifting of sanctions, the potential for expanding these ties was immense.
"They agreed that pending agreements such as Preferential Trade Agreement, Double Taxation Avoidance Agreement and Bilateral Investment Treaty should be concluded on a priority basis," said Swarup.
India is keen to enhance its investment in Iran as there has been impressive prospect of the country’s economic growth. The size of Iran’s economy is around $400 billion, the second largest in the Middle East after Saudi Arabia, and the country is being seen as one of the world's hottest investment destination as it has opened various critical sectors including oil and gas for joint ventures and foreign capital.
Countries like Japan, China, the US and a number of European nations are scrambling to take advantage of opportunities in the oil-rich nation after the sanctions were lifted in January.
India has been eying deeper energy ties with Iran and has already lined up U$20 billion as investment in oil and gas as well as in petrochemical and fertiliser sectors there. India is also keen to increase oil imports from Iran from current 350,000 barrels a day. Both sides decided to enhance cooperation in counter-terrorism and maritime security as they agreed that concerted global effort was required to combat the menace. They reviewed bilateral relations, in particular the progress in implementing the decisions taken at the last Joint Commission Meeting held in New Delhi in December 2015.
"Both sides took note of the good cooperation between the National Security Council structures of the two countries and agreed to intensify this engagement," said Swarup.
In terms of cultural cooperation, both sides agreed to promote and strengthen the existing cultural exchanges, inter-alia, by observing "Weeks of Iran and India" in each other's country, publication of manuscripts, organizing conferences and events related to language, literature and religion. They also agreed on the establishment of a Hindi Chair in Tehran University sponsored by ICCR and to renew the Cultural Exchange Programme. Both leaders expressed satisfaction at the recent exchange of visits and called for more high level exchanges to give fresh impetus to India-Iran relations. The two ministers also reviewed global and regional issues, in particular the situation in Afghanistan. Earlier in the day, the External Affairs Minister visited an Indian Gurudwara and the Kendriya Vidyalaya. She met the members of the small but vibrant Indian community in Tehran and assured them that she would take up issues of concern to them with the Iranian leadership.