Indian Delegation to Visit Iran for Investment Negotiations

Informed sources in India have stated that a delegation composed of economic and energy officials from the country will visit Iran this week to explore investment opportunities ahead of the final stage of nuclear negotiations. According to Reuters, this delegation includes officials from the Ministry of Economy and Energy, as well as senior managers from two refineries and a chemical products company, and will meet with their Iranian counterparts on Saturday. After China, India is the second-largest buyer of Iranian oil, although the volume of its imports has somewhat decreased due to Western pressures and international sanctions against Iran in recent years. The volume of Iranian oil imports by India was about 370,000 barrels per day in 2010 and 2011, but fell to around 220,000 barrels in 2014. The preliminary agreement between Iran and world powers on April 2 to limit Tehran's nuclear program has paved the way for a final agreement, which is expected to be signed by the end of June. In this case, Western powers will gradually lift some economic and financial sanctions in exchange for limiting and closely monitoring Iran's nuclear programs. Informed sources in the Indian government told Reuters that in addition to purchasing a larger volume of oil under better terms and exploring other investment opportunities in the energy sector, India is interested in investing in the Farzad-B natural gas field, which is part of the South Pars field. Fatih Birol, the chief economist of the International Energy Agency, recently told Reuters that Iran needs a significant amount of foreign investment and new technologies to increase its oil production, as its oil and energy industry has suffered severe damage or has become significantly worn out and outdated due to long-term international sanctions. In 2002, a consortium of various companies under the ONGC Videsh, the international arm of the Oil and Natural Gas Corporation of India, signed a contract with Iran to develop the South Pars gas fields. It is estimated that the Farzad-B natural gas field has over 12 trillion cubic meters of natural gas and has an operational lifespan of about thirty years. An Iranian diplomat told Reuters that Iran needs about $220 billion in investment to implement new projects and rebuild the current infrastructure of the country's oil and gas industry. He added that the development and operation of the Farzad-B gas fields would cost about $7 billion. Rostam Qasemi, Iran's former oil minister, proposed a contract for participation in the development and operation of these fields to India in 2013, which differed from Iran's usual method of setting a specific rate for the return on investment. Informed sources in India's energy sector say that the country refrained from signing that contract due to Western pressures and recent economic sanctions against Iran.