Stepping up its energy ties with Iran, India has lined up USD 20 billion as investment in oil and gas as well as petrochemical and fertiliser projects in the Persian Gulf country subject to provision of concessional rights. Oil Minister Dharmendra Pradhan, on a two-day visit to Tehran from April 9, also discussed with his Iranian counterpart the repayment of nearly USD 6.5 billion that Indian refiners owe to Iran, but there is no agreement yet on rights to develop Farzad-B gas field in the Persian Gulf discovered by OVL.

The minister informed the Iranian side that Indian companies could invest up to USD 20 billion and are interested in setting up petrochemical and fertiliser plants, including those in Chabahar SEZ, either through a joint venture between Indian and Iranian public sector companies or with private sector partners. “In this regard, he requested Iran to allocate appropriate and adequate land in the SEZ.

He also requested the Iranian side for favourable treatment in the pricing of gas for India and supply of rich gas at competitive price on long-term basis for the life of joint venture projects Indian companies are interested in setting up,” an official statement read. Pradhan said India did a fine balancing act after Prime Minister’s visit to Saudia Arabia earlier this month. Accompanied by ONGC Videsh MD Narendra K Verma and Indian Oil Corp (IOC) Chairman B Ashok, Pradhan sought to engage with the leadership of the oil-rich nation that has stepped out of international sanctions. This was the first visit by an Indian minister since the US and other western powers lifted sanctions against Iran in January.

Within days, Chinese President Xi Jinping travelled to Tehran, signing 17 accords and agreeing to increase bilateral trade by more than ten-fold to USD 600 billion in the next decade. Keen not to rub Saudi Arabia the wrong way — China’s largest oil supplier — Xi visited Riyadh and Egypt before heading to Tehran.

“Pradhan had meetings with Minister of Petroleum Bijan Namdar Zanganeh, Senior Advisor to President of Iran on Free Trade Zones Akbar Torkan and Governor of Iranian Central Bank Dr Valliolah Seif,” the statement said. The two nations, it said, discussed developments regarding Farzad-B gas field and expressed confidence in concluding an agreement at the earliest.

“The issue relating to payment of dues by Indian refineries to Iran towards purchase of crude oil was also discussed. Pradhan conveyed that India is committed towards making payments as and when banking channels, acceptable to both sides, are available,” the statement added.