PXL/HO/Cir-084/2018-19 Date: 10.01.2019
Bilateral Trade Payments between
India & Iran
Dear Sir / Madam,
It is understood that an Agreement is entered between India and Iran for easing the Trade Payments.
Salient features of the Agreement are:
1. Designated Iranian Banks can open Indian Rupee Vostro Accounts in UCO Bank and other mutually agreed banks assigned for this purpose
2. 100% of amounts payable by Indian importers, including oil companies, will be credited to the Indian Rupees Vostro accounts opened by Iranian Banks
3. 50% of such amounts credited will be utilized for making payments to Indian exporters of goods and services to Iran, Fee of Iran students studying in India and establishment expenses of Iranian Missions in India. These funds may also be used for settlement of payments of Indian exporters for transactions that took place prior to operationalization of this arrangement.
4. Balance 50% will be used for making payments to Indian companies undertaking projects in Iran, direct investments in India subject to terms and conditions of FDI policy of India etc.
It is also understood that Government has allowed Iran’s Bank Pasargad to open a branch in Mumbai, while UCO Bank will be opening a branch in Iran.
It is expected that with the above arrangements, there will be a smooth bilateral trade payments between India and Iran.
This is for information of members.