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Finance Ministry says no to Iranian bank's plan to open branch in India

Earlier, Ministry of Home Affairs had also denied security clearance to applications by Parsian Bank and two other Iranian banks fearing threat of money laundering and terror financing in banking transactions

 
New Delhi: The Finance Ministry has declined permission to Iran's Parsian Bank to open a branch in India apparently due to security concerns and threat of money laundering, reports PTI.
 
Iran had been pressing New Delhi for allowing Parsian Bank to open a branch to settle oil and other trade with India.
 
The matter was examined by Reserve Bank of India (RBI), and subsequently, based on RBI's report, a decision was taken by the Finance Ministry not to agree to Parsian Bank's application, sources privy to the development said.
 
Earlier, the Ministry of Home Affairs (MHA) had denied security clearance to applications by Parsian Bank and two other Iranian banks fearing threat of money laundering and terror financing in banking transactions as cautioned by the Financial Action Task Force (FATF).
 
India became a member of Paris-based FATF in 2010 and is required to follow standards prescribed by FATF to check money laundering and terror-financing activities.
 
Sources said since RBI in December 2010 scrapped a long-standing mechanism of settling payments through the Asian Clearing Union mechanism; India pays 55% of the value of oil its imports from Iran in euro payments through Turkey's Turkiye Halk Bankasia. The balances 45% of crude payments are made in rupees through UCO Bank.
 
Under the rupee payment mechanism, 45% of the payments made by Indian oil companies for their imports from Iran are credited in rupees in the accounts of Iranian Banks maintained with UCO Bank.
 
These rupee resources are being used for making payments for Indian exports, including project exports, to Iran.
 
Besides opening a branch, Tehran also wants the rupee balance in the UCO Bank accounts to be permitted to finance third country imports by Iran.
 
The operational modalities have to be discussed and agreed between the two sides, sources said.
 
India imported 17.44-18 million tonnes of crude oil from Iran -- 10.5% of the nation's total oil imports in 2011-12. This year, imports from Iran are likely to dip to 14-16 million tonnes or 8.4% of 190 million tonnes of planned crude oil imports.
 
Bilateral trade between the two nations is skewed in favour of Iran. In 2011-12, the total trade between India and Iran was around $15.94 billion. While India's exports were around $2.4 billion, India's imports from Iran were around $13.5 billion. India's imports exceed that of its exports by $11.14 billion.
 
Sources said while India's gross exports to the world increased by more than 21% during 2011-12 as compared to previous year, India's exports to Iran declined by 3.8%.
 

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Merchant tanker Pavit's route still remains untraced

According to officials, they failed in tracing the route because of the weather conditions between June-August and said the route will always remain a 'mystery'

 
Mumbai: Shipping authorities in India have still not traced the route that merchant vessel M V Pavit followed to reach Mumbai following unfavourable weather conditions, reports PTI.
 
The grounded oil tanker drifted from Oman coast to the city's Juhu-Versova beach in July last year.
 
According to officials, they failed in tracing the route because of the weather conditions between June-August and said the route will always remain a "mystery".
 
"We wanted to reconstruct the route with the help of satellite imagery, but at that time monsoon was prevalent and the entire area was covered with clouds. We are therefore not successful in tracing the route," said an official from the Directorate General of Shipping.
 
Also, no one even spotted this vessel drifting or else we would have alerted concerned authorities, the official said.
 
After the vessel ran aground at Juhu, an investigation was launched to ascertain the cause of it getting adrift unmanned to the shores of Mumbai.
 
The ship had started drifting off Oman coast on 29 June 2011 due to engine failure and ingress of water in the engine room.
 
All the 13 Indian crew members were rescued by a warship before it finally ran aground on 31st July. The ship was later moved to Dabhol Port.
 

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