India and Iran are in talks to boost energy ties and trade after a seven-year freeze on oil imports

India and Iran on Thursday discussed strengthening energy cooperation and bilateral trade during a meeting on the sidelines of the BRICS Energy Ministers’ meeting in New Delhi.

Iran’s oil ministry’s Shana news site first reported the development after a meeting between the oil ministers of the two countries. India’s Oil and Gas Minister Hardeep Singh Puri met Iran’s Oil Minister Mohsen Paknejade and discussed ways to strengthen bilateral cooperation in the oil and gas sector.

Iran’s oil minister met Puri on the second day of his visit to India and stressed the importance of strengthening cooperation between Tehran and Delhi.

Ties between India and Iran

Historically, India has been a major buyer of Iranian oil, but it suspended imports in 2019 after Washington reimposed sanctions on Iranian oil exports, Reuters reported. Since then, cooperation in the oil sector between the two sides has declined significantly. However, Tehran and Delhi continued to hold talks on broader energy cooperation and the use of their strategic infrastructure and trade capacities, including the Chabahar port.

Ministers reviewed opportunities to strengthen cooperation in oil and gas and explored opportunities to expand bilateral engagement in the energy sector.

Earlier on Wednesday, Paknejad, who arrived in New Delhi to attend BRICS meetings on energy cooperation, said Tehran was ready to establish economic ties with India, ANI reported. He added: “As you know, we have historical relations between Iran and India for a long time, for centuries, as you know. I am here at the moment to attend this meeting as the BRICS energy minister for the BRICS members. And I will see what we will talk about in these meetings, bilateral meetings and completely in the conference. And now we are ready for all the relations with India, especially in the economic areas that we can have.”

The development comes a week after Iran and the United States signed an interim agreement, after which Washington issued a temporary license allowing the export of Iranian energy products.

Here is how much Iranian oil India was importing before sanctions

According to a PTI report, Iranian crude accounted for 11.5 percent of India’s total imports at its peak. However, following the tightening of sanctions in 2018, India’s oil imports from Iran ended in May 2019 and volumes were replaced by Middle Eastern, US and other grades.

India bought 518,000 barrels per day of Iranian oil in 2018, which slowed to 268,000 barrels per day between January and May 2019 when the US granted an exemption to several buyers. No imports have taken place since then.

India defends energy sovereignty

Ahead of a meeting of Indian and Iranian oil ministers, the Ministry of External Affairs (MEA) on Tuesday defended India’s energy sovereignty, saying New Delhi’s drive for energy security for its 1.4 billion people remains strictly motivated by “national interest”.

Addressing the briefing, MEA spokesperson Randhir Jaiswal emphasized that the country’s strategy includes diversifying its energy sources to ensure availability. His remarks came against the backdrop of the ever-evolving geopolitical situation in West Asia and questions over New Delhi’s decision to source oil from sanctioned countries and Russia’s exemptions, ANI reported.

He added: “As far as our sourcing of energy is concerned, you are well aware that our policy is based on national interests. Our policy is to provide energy at affordable prices and from various sources to India’s 1.4 billion people. I have said this on several occasions and it remains so.”