India’s Finance Ministry has announced that there is no objection to allowing the Iranian private lender Bank Pasargad to open its branch in Mumbai and the Iranian bank’s proposal has been approved.
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According to Indian Express, in the wake of US sanctions, India may explore the possibility of reviving the rupee-rial arrangement to oil-related transactions with Iran that it has used in the past.
This is while US has repeatedly asked other countries to minimize oil import from Iran.
The Federation of Indian Export Organizations had suggested Reserve Bank of India to allow the establishment of Iranian bank branches in India, highlighting that this can facilitate bilateral trade.
An active Iranian bank in India opens a financial channel which can secure flow of funds between the two countries.
India is among main importers of Iranian oil and has also invested some $500 million in Chabahar port, Southeastern Iran.