The Indian government has provided a great relief to Iran, which is facing global restrictions on behalf of the United States. The Ministry of Finance has released the National Iranian Oil Company (NIOC) from the huge amount of tax in rupees for heavy withdrawal tax. According to the Reuters report, this relief has been given on 28 December but will be effective only from November 5.
After this relief, the Indian refineries will now be able to settle pending $ 1.5 billion with NIOC. After the US banned the international market, Iran and India had entered into an agreement on November 2. Under this, the two countries had decided to pay the payment of their oil business through the Indian government UCO Bank in rupees.
However, a foreign company has to pay huge tax on its income deposited in Indian banks. Apart from 40 percent discounted tax, it charges 42.5 percent, in addition to other charges. Now India has freed Iran from a tax freeholding tax. Iran can spend payments in rupees with the help of UCO Bank in different items.
Reuters has reviewed Indian documents and said that Iran can make this money in India, the import from Iran, the Iranian mission run here, direct investments in Indian projects, and financial assistance to Iran’s students in India. Iran can also invest this money in the debt securities of the Government of India.
An official has said on condition of anonymity that earlier Iran could use this money only on imports from India. This time India has enhanced the scope of the use of this fund while seeing the benefit of both countries. Although this tax relief is available only on crude oil, it is not a relief on imports of compost LPG.
Explain that after India, India is Iran’s second largest consumer of oil. Since the American ban came into effect, India had started paying the money in Iran. Oil Secretary Joint Secretary Sanjay Sudhir says that after this new change, Indian refineries will be relieved of the hurdles in payment. One of the top Indian buyers of Iranian oil, Indian Oil, a top official told that his company will start paying Iran from January.
The finance ministry has not responded to Reuters’ questions in this regard. The US had imposed sanctions on Iran in November for funding Nuclear and Ballistic missile programs and funding of terrorists in the Middle East. However, the US exempted eight countries, including India, from importing oil from Iran.