India takes up Iran's defaults on payments to rice exporters

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SME Times News Bureau | 17 May, 2012
India has taken up default in payment by Iranian buyers for export of rice, said Minister of State for Commerce and Industry Jyotiraditya M. Scindia in the Rajya Sabha on Wednesday.

"The Embassy of India, Tehran has taken up the matter with the relevant Government authorities in Iran for clearing the payments. As per available information, the defaulters are Iranian private companies and not Government entities," Scindia saidin a written reply.

Recently, the All India Rice Exporters Association had informed the Government that their members were facing problems in receiving payments for shipments of Rice made to Iran. The overdue amount was reported to be about Rs. 200.00 crores.

The defaults were for shipments under term deals in October and November free-on-board Indian ports, Indian traders had said. Most Indian rice exporters allow 90 days credit.

India is Iran's top rice supplier, accounting for some 70 percent of its annual requirement of 1-1.2 million tonnes of the grain, mainly the aromatic variety called Basmati.

Replying to another question, the minister informed that the Rial-Rupee payment arrangements have been put in place as the US and Eurozone sanctions on Iran have the potential to disrupt India's trade with Iran.

"India exports goods to Iran in accordance with its international obligations of United Nations sanctions on Iran. Major items of India’s export to Iran include agriculture commodities and textiles," he said.