Rice ban (illustrative).
(photo credit: REUTERS/Ajay Verma)
Indian Urban Development Minister Kamal Nath said Tuesday during a visit to Israel that his government "in no uncertain words” condemns Monday’s attack against Israeli embassy staff in New Delhi. He added that India is confident it will be successful in bringing the culprits to justice.
But when asked by The Jerusalem Post whether he agreed with comments made by the head of the All India Rice Exporters’ Association that the attack would harm efforts to maintain trade with sanctions-hit Iran, Nath said: “I don’t think so.”
Earlier Tuesday, the head of India's rice trade body said the previous
day's attack in New Delhi may "dampen" and "hurt" India's efforts to
carry on trade with sanctions-hit Iran and may complicate efforts to
resolve a trade payment impasse.
Energy and Water Minister Uzi Landau, who sat alongside Nath at a Tel Aviv seminar on bilateral trade, said business with India had grown rapidly over the past two decades despite facing a common problem with terrorism.
The Israeli government is not hesitant about expanding trade with India, Landau said, adding that the answer to the latest terrorist attack is “to step up activities between our two countries.”
India has struck a defiant tone over new financial sanctions imposed by the United States and European Union to punish Iran for its nuclear program, seeking to increase trade and barter arrangements
to pay for oil supplies.
But the attack, which wounded four people, could add to uncertainties in trade between India and Iran, Vijay Setia, president of the All India Rice Exporters' Association, told Reuters.
"It will complicate matters further and hurt trade," Setia said, adding it was difficult to say how seriously trade could be affected.
"It (the tension generated by the attack) is a matter of concern and it will dampen trade sentiments between India and Iran," Setia said.
Israel accused Iran and Hezbollah
of being behind the twin bomb attacks that targeted Israeli embassy staff in India and Georgia on Monday. Tehran has denied involvement in the attacks.
India is currently Iran's biggest oil buyer as well as Tehran's top supplier of rice. It is considering stepping up exports of a range of goods, including wheat and rice, to settle part of its $11 billion annual oil bill to Iran.
The two sides are seeking alternative payment mechanisms to settle their trade after existing conduits have either been scrapped or become vulnerable in the face of Western sanctions.
The payment impasse has already meant Iranian buyers have defaulted on purchases of about 200,000 tons of rice from India worth some $144 million.
Setia said that default figure is rising.
"Credit is building up and at the same time some of the Iranian buyers are asking for a longer credit period," he said.
Most Indian rice exporters allow 90 days credit.
Iran relies on imports for about 45 percent of its annual rice consumption of 2.9 million tons, according to US Department of Agriculture data.