NEW DELHI – As Western sanctions squeeze Iran and its currency tumbles, the country's energy minister wooed Indian businesses for more investment and trade.
Majid Namjoo told a meeting of Indian business leaders Wednesday that huge business opportunities exist with Iran's private sector, which remains largely unaffected by sanctions imposed by the United States and the European Union.
Namjoo is on a four-day visit to India to explore the possibilities of trade and joint ventures in renewable energy, power, pharmaceuticals, agriculture and food processing.
The United States and the European Union have imposed sanctions on Iran to deter it from pursuing a nuclear weapons program. Iran insists its nuclear program is for peaceful purposes.
The U.S. has pressed India to scale back its imports of Iranian crude to support those sanctions, but energy-starved India remains one of Iran's biggest oil purchasers.
Indian National Security Adviser Shivshankar Menon denied on Wednesday that Iran was a divisive issue between India and the United States.
"We both seek the same end, a negotiated resolution of the Iranian nuclear issue without the spread of nuclear weapons," he said. "We may have different judgments as how to get to that goal."
Namjoo said the Iranian government has been privatizing government companies to reduce the impact of Western sanctions, and that a large number are open for investments.
"We are trying to make Iranian industries more competitive in price and quality. This is a big opportunity for Indian companies to invest in Iran, or in third countries through joint ventures with Iranian firms," Namjoo said.
He said Iran is preparing for a future when it will run out of oil and gas resources and is searching for renewable energy options.
Namjoo said India and Iran could work together in the field of hydroelectric energy in which Iranian companies have extensive expertise. Iran is exploring the feasibility of exporting some 4,000 megawatts of electricity to India.
India has been actively searching for investment deals with Iran as an ad hoc barter arrangement to pay its oil bills.
India imports around 70 percent of its oil needs, of which about 11 percent comes from Iran. It has been facing enormous problems over payments for the Iranian oil.
New Delhi initially channeled payments through German-based Europaisch-Iranische Handelsbank. But after the sanctions kicked in, the two countries moved to Turkey's Turkiye Halk Bankasi AS to facilitate payments.
That channel may also become inoperable after EU intervention. In February, Iran and India reached an agreement under which India would pay for 45 percent of the oil in Indian rupees, with the rest to be settled through a barter arrangement in goods and services.
The fallout of the sanctions is beginning to be felt by Iran, its currency and its people.
The Iranian rial, which has lost more than half its value in the past year, last week tumbled to its lowest value against the U.S. dollar — 35,000 rials to a dollar. The currency's plunge was marked by small street protests in the tightly controlled society.
But a defiant Namjoo told journalists that while his country could weather the effect of sanctions, Iran's European neighbors were worse off.
"Iran is a big country. We will survive the sanctions," he said.
India, too, has been slowly easing its dependence on Iranian oil.
India also has strategic interests in the Iranian neighborhood. New Delhi is helping to develop the southern Iranian port of Chabahar and a rail link that will offer it direct access to landlocked Afghanistan and Central Asia.