|SAIL CMD CS Verma|
15,000 km to connect its major ports and key production centres.
Chairman of state-owned trading firm State Trading Corporation (STC) Khaleel Rahim is likely to visit Tehran this week to finalise some of the formalities that could pave the way for steel exports from India. Iran had sought Indian investment in massively expanding its railway network and needs about 3 million tonnes of steel rails to connect all major cities, industrial centres and also ports for faster evacuation of goods.
US had eased sanctions on Iran last year, which has enabled Indian companies to explore investment options. The commerce ministry officials had in December last year, met the top brass of SAIL, BHEL and railway infrastructure builder IRCON to consider investing in Iran. According to a media report, STC has been tasked to finalize the deal. SAIL chairman CS Verma said after several rounds of discussions with the commerce ministry and STC, SAIL has expressed its readiness in supplying three MT rail steel. SAIL’s Bhilai steel plant is the sole supplier of the country’s longest rail tracks of 260 metres. With an annual production capacity of 3.15 MT of saleable steel, the plant also specialises in other products such as wire rods and merchant products. According to commerce ministry officials Indian exporters are depending on the UCO Bank to help implement the rupee payment mechanism. The relaxation of the payment mechanism has helped propel Indian exports to Iran to over $550 million.
Public sector lender UCO Bank began handling payments for India-Iran trade in 2012, under which domestic oil refiners buy oil from Iran but make payments into an ‘Iran Account’ with UCO Bank’s Mumbai branch. When Iranians import goods from India, the bank pays the Indian exporters out of this account. Bilateral trade between the two countries is likely to cross the $20-billion mark in FY14, up from $15 billion in FY13.
India’s exports to Iran include rice, metals, machinery and instruments, primary and semi finished iron and steel, drugs and pharmaceuticals, processed minerals, man-made yarn and fabrics, tea and rubber manufactured items. Main imports from Iran include crude oil, urea, petroleum products, saffron and dry fruits.