India has paid all oil debts. News was disclosed by Mahmoud Bahmani, Central bank governor of Iran told to the IRNA news agency. The payment was done in cash not by any bartering system.  India is the second largest oil buyer of Iran. The Indian interest of repay the debts by bartering system or by any goods was rejected by Iran. Thus the five billion Dollar debt was cleared.

India was struggling to pay the amount for last six months. The main reason was the American pressure on the grounds of Iran’s nuclear programs. Tehran was beaten by the International agencies for the Uranium Enrichment Process. Both U.S. and European Union placed prohibitive restrictions on the transactions with Iranian banks and financial institutions. Many Asian and European banking channels were using New Delhi to pay the amount to Iran. Those actions were closed by the regulations.

According to the Indian refineries, the banks were very reluctant to transfer money to Iran due to the international sanctions. India imported $ 7.8 billion cost goods from Iran between April to December 2010. Out of this, oil imports stands at $ 6.658 billion. Indian export to Iran during the time was $ 2 billion. India’s non oil imports from Iran were only $ 1.2 billion. As a nuclear power in the region, India does not wish the arrival of a new nuclear power like Iran. But India keeps a strategic alliance with Iran. But India really wishes to keep the civilian nuclear agreement with U.S. But the Indian Government was not ready to link both these issues. There were allegations to the Manmohan Singh Government by the Indian Opposition parties that the government is acting as a servant of America.

According to Hyde Act, the American President has to submit an assessment report in Congress related to the Indian cooperation with U.S. The Indian left parties were opposing the infringement of U. S. in the key decisions of the nation. Left parties did not support the India U.S civilian nuclear agreement. Our government had a narrow escape from the non confidence motion by the opposition.  As far as Iran is concerned, Oil export is the key source of foreign exchange revenue.  Iran’s non oil exports constitute 30% of the total export. The Iran government is now concentrating more in the privatization activities. FDI inflow to the country is expected to improve in the coming years.