Iran has backtracked on commitments to sell oil and gas to India following disagreement on how the bill would be paid according to reports.
Since July 2011 India had been meeting its oil and gas bills with 55% in euros and 45% in its national currency – the rupee.
In February of this year the payments in euros were stopped and in July Iran agreed to be paid entirely in rupees.
After a brief trial it terminated the arrangement, demanding a return to the 45-55 split. With oil imports driving a record current account deficit and foreign currency pouring out of the country India was keen not to go back.
But negotiations have failed and the Indian Express reports Iran’s new government has now decided not to fulfill the oil and gas concessions agreed by its predecessor.