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Envoy: Iran, India to Seal Special Trade Deal by Yearend

30-08-2019, 13:31

Envoy: Iran, India to Seal Special Trade Deal by Yearend

VOİCEPRESS - Iran’s Ambassador to India Ali Chegeni said that Tehran and New Delhi are poised to finalize a trade agreement by the end of 2019, in a bid to increase bilateral trade and circumvent Washington’s unilateral pressures on the two Asian countries.
Chegeni said on Wednesday a major trade deal between Tehran and New Delhi is almost there to be concluded by the end of 2019 as the two countries seek to bypass American sanctions imposed on Iran and to increase the size and scope of bilateral trade activities.

The envoy highlighted that Iran and India hope a Preferential Trade Agreement (PTA) could be sealed by the end of this year to make trade between the two "cheaper and simpler".

Speaking at a meeting with Indian businessmen hosted by PHDCCI, India’s top trade body, Chegeni said that a fifth round of talks between the representatives of Iran and India is planned to take place in New Delhi to allow the two sides to complete “very few formalities” ahead of the signing of the PTA deal.

The ambassador, however, said that a proposed Bilateral Investment Protection Agreement (BIPA) between Iran and India would take a little longer to be finalized while a Double Taxation Avoidance Agreement (DTAA) would be ready to be implemented once the Iranian government and parliament approve the agreement.

Chegeni said Iran and India had made huge progress in facilitating trade between the two over the past year despite sanctions imposed by the United States.

"There is scope for bilateral trade to rise to $30 billion soon and then to $50 billion,” he said, adding that trade between Iran and India had surged to $17.50 billion in 2018 from $13.5 billion in 2017.

He also said that the two countries had signed a total of 26 deals and memorandums of understanding on trade and economic cooperation over the past few years.

Chegeni said that the two countries had a separate mechanism to encourage barter trade to further offset the impacts of American sanctions on the economic cooperation between the two countries.

“We could do barter trade with India agriculture against agriculture, pharmaceutical against pharmaceutical and so on,” he said.

Iran and India have actively sought ways to bypass the American sanctions which started in November and were toughened in May when Washington removed waivers granted to India to continue to buy oil from Iran.

Iran and India have also established a financial mechanism to settle trade payments in local currencies. That has been a major help to companies and businesses trying to circumvent the sanctions.

Earlier this month, Iran's Consul General in India's Hyderabad Mohammad Haqbin Qomi said that Tehran and New Delhi are determined to increase the volume of annual bilateral trade to at least 30 billion dollars by activating capacities in their respective economies.

Haqbin Qomi said on August 14 that Tehran and New Delhi have targeted 30-billion-dollar worth of trade exchange in light of the great capacities of the two countries for economic cooperation.

The envoy added that reports show that trade exchange between Iran and India has been 18 billion dollars in 2018, the figure that can increase regarding the existing capacities.

Everything has been prepared for boosting economic cooperation with India, while the sanctions have made it difficult, the official said.

Asked about relations between Iran and India, Haqbin Qomi said the two countries experience good and growing cooperation.

He further referred to agricultural products of Southern Iranian province of Bushehr as good grounds for fostering trade cooperation with India.

Early in last month, Indian Ambassador to Tehran Gaddam Dharmendra said that Iran’s Southeastern port city of Chabahar is of prime importance to New Delhi, adding that the two countries increased their trade in the last year by 30%.

In a meeting with Chabahar executives and officials on July 06, Dharmendra said that Chabahar is of great importance for New Delhi, given the strategic location and connection to the Indian Ocean, and the Indian government and private sector are keen to attend and invest in this zone.

"The trade between Iran and India have grown well over past years, and thus the ports of India and Chabahar will have better cooperation in the future," the envoy added.

Referring to the capacities, investment opportunities and transportation of transit goods in the Chabahar port, the diplomat said, "This city is significant more than a target for the Indian government in relation to the issues that it is pursuing."

The Indian Ambassador noted that there needs to be a clear dialogue about the commitments in regard to Chabahar, and said, "We need to consider the short and long term credit line in the form of a single package."

Darmandera underscored that Tajikistan, Uzbekistan, Kyrgyzstan and other Commonwealth of Independent States (CIS) can cooperate in this port and transport their goods with the best way of transportation.

Expressing that India and Afghanistan repeatedly pursued the exclusion of the Chabahar port from the unilaterally imposed US sanctions regime, but still the banks issue poses a challenge, he pointed out that during the past year, Iran and India's trade grew by 30 percent and reached about 17 billion dollars a year.

The high-ranking Indian figure described India as one of the main suppliers of basic goods to Iran, and added, "We created a special bank in India connected with the Iran-India Chamber of Commerce to carry out a commodity exchange."

"Given the growth that exists in our business, Indian ports and Chabahar port are important ports, and we certainly do what we are committed to,” the Ambassador of India in Iran emphasized.

"Though there are still problems with third-party produced items, this will not stop our commitments, and all our commitments will be prioritized,” Dharmendra stated.

Late in June, a member of Iran-India Friendship Association Masih Mirhosseini said that fre trade zones in South and North of Iran can serve as the gates of entry and exit for transiting Indian cargoes destined for Eastern and Northern Europe with helpful economic exemptions and great capacities.

Location of Chabahar and Anzali free trade zones as entry and exit origin of North-South Corridor and legal exemptions of these zones will play a significant role in the development of ties between Iran and India, he stressed.

The two countries of Iran and India are the oldest and most influential countries of human civilizations in the course of history which played a significant role in the promotion of qualitative and quantitative level of human civilization, Mirhosseini added.

Early in January, Indian Minister of State for External Affairs Vijay Kumar Singh, addressing the Iran-India Business Forum, highlighted the importance of Chabahar port for India as the gateway of trade ties of the country with the Central Asia.

Kumar Singh said that Chabahar Port is of prime significance to India, adding, “As regard to relations with Central Asia, Iran is of importance and we should consider its opportunities.”

He went on to say that Iran is not just a trade partner for India but it is a close neighbor.

“Iran and India enjoy commonalities in economic and security fields,” he added.

The relations between the two countries are not something new but the trade communities of the two countries have known each other for a long time, the Indian official underlined.


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