Ignore US ire, import Iran oil to save $8.5bn, Veerappa Moily suggests

New Delhi, Sep 2: The Manmohan Singh government will have to tread on a diplomatic tightrope with oil minister M Veerappa Moily suggesting India may save nearly $8.5 billion (around Rs 57,000 crore) by importing cheaper crude from Iran which faces UN sanctions in the wake of its nuclear programme.

In a note to Prime Minister Manmohan Singh and finance minister P Chidambaram, Moily has said that so far this year, India has imported 2 million tonnes of crude from Iran and an additional 11 million tonnes would pare the forex outgo by almost $8.5 billion, assuming oil price at $105.

Last year, India had imported a little over 13 million tonnes from Iran and Moily has suggested that state-run oil companies should be asked to maintain their overall crude imports at last year's level.

The Iran gambit is central to Moily's attempt to reduce India's oil bill by $20 billion but will need a reversal of India's recent attempts to reduce business with the regime in Tehran.

But the need to control an expanding deficit — fueled by a weak rupee — is becoming urgent, and India may have to repair ties with Iran that have hit an air pocket over the Iranian security forces detaining an Indian ship transporting Iraqi crude. India will need to display some creative diplomacy to tip toe around international sanctions and US sensibilities.

On August 12, even Chidambaram had spoken of importing more crude from Iran as part of his drive to contain current account deficit within the $70 billion target for this financial year. He had, however, made it clear that the operations had be undertaken without breaching UN sanctions.

Although several Asian countries, including India and China, have been provided flexibility, the government has reduced its dependence on Iran. In 2012-13, India imported about 7.2% of its oil from Iran, compared to 10.5% in the previous year.

India imports over 70% of its oil requirement, which is one of the key drivers of India's import bill. In the absence of a rise in exports, the trade and current account deficits have widened, adding to the pressure on the rupee.

But unlike imports from other countries, India can make the payments to Iran through a rupee account, which was created as part of the settlement mechanism to deal with the UN sanctions.

Moily's plan is in response to the PM's call to the ministry seeking a $25 billion cut in the oil import bill to narrow the current account deficit. He has suggested several measures to reduce the oil import bill by $19-20 billion this fiscal.

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JD(S) leader G T Devegowda backs CM Siddaramaiah in MUDA row, taunts HDK

News Network

October 4,2024

Mysuru: Chairman of JD(S) core committee and Chamundeshwari constituency MLA G T Devegowda on Thursday expressed his solidarity with Chief Minister Siddaramaiah saying the latter need not resign, while lambasting leaders of his own party and alliance partner BJP, including Union Minister H D Kumaraswamy.

In his speech during Mysuru Dasara inauguration he said that if persons against whom FIR is registered have to resign, many leaders from all the three parties, including Opposition Leader R Ashoka, will have to resign.

“All are sitting in glass houses... Since I know Siddaramaiah well, I am talking about him. At a time when mines and real estate are ruling politics, Siddaramaiah has survived in politics. He has never done any favour,” Devegowda said.

He added, “Allegations against Siddaramaiah are unexpected and accidental. If the Governor and Chief Justice order an investigation, it does not mean that he should resign."

He continued, asking, "Have they told Siddaramaiah to resign or have they asked to imprison him? When a person becomes a Central minister, he or she should realise their dignity and responsibility. Instead of recognising the good work done by Siddaramaiah, they ask him to resign. Will Kumarswamy (facing an FIR) resign? Should Siddaramaiah, who has become CM with a support of 135 MLAs, resign?"

"Opposition leaders are not remembering the good work of earlier CMs Kengal Hanumanthaiah, Veerendra Patil, Ramakrishna Hegde, H D Deve Gowda or S M Krishna. Karnataka is a model state. It is a bad trend to topple an elected government which is doing good work,” he further said.

Devegowda added, “Siddaramaiah is Goddess Chamundeshwari’s ‘Varaputra’ and hence has her blessings during tough times. He won the election in Chamundeshwari Assembly constituency, when the BJP-JD(S) government was in power in 2006. With the blessings of the Goddess, he has held varied positions right from becoming an MLA for the first time in 1983. He presented 15 budgets and has become CM for a second time. He took H C Mahadevappa, a Dalit leader to the state level. Siddaramaiah has the support of Deputy CM D K Shivakumar as ‘Jodeththu’. Blessings of the beneficiaries of guarantee schemes are with him (Siddaramaiah).”

Siddaramaiah said, “Devegowda was a MUDA member. He knows the truth. Hence, he is saying this. His words have filled strength in me. ‘Satyameva Jayate’, Truth will always triumph.”

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