EU says India sets own policy on Iran oil exports

(NEW DELHI) - The European Union, which has agreed to an embargo on Iran's oil exports as well as financial sanctions, said Monday it was up to energy-hungry India to decide how it deals with Tehran.

India said last week it was continuing to buy oil from Iran, despite an intensifying US-led campaign to smother Tehran's vital oil exports until it abandons its nuclear programme.

"Our sanctions determine what European countries do. We cannot determine what Indian companies do or do not," Joao Cravinho, the new EU Ambassador to India, told reporters in New Delhi.

After weeks of tough talks on the terms of a ban on Iranian crude, ambassadors of the the 27 EU nations reached a political agreement earlier on Monday over sanctions against Iran. Iran sells around 20 percent of its crude to EU nations, with Greece, Spain and Italy the top buyers.

Asked about the possible impact on India-EU relations in the wake of sanctions on Iran, Cravinho replied: "The EU will always respect the position taken by Indian authorities."

"Obviously, EU sanctions are for the European Union," he said.

Iran is India's second-largest oil supplier after Saudi Arabia, providing around 12 percent of the fast-growing country's needs at an annual cost of around $12 billion.

Cravinho said the EU sanctions are to "step up pressure" on Iran because the reports coming from International Atomic Energy Agency (IAEA) about its nuclear programme were "very worrisome" for the EU and the rest of the world.

"Conversations with Iran have been taking place for quite a long time," Cravinho said. "There are doubts about the nature of Iran's nuclear programme.

The EU oil embargo agreement provides for an immediate ban on importing Iranian crude and a gradual phase-out of existing contracts between now and July 1, diplomats told AFP.

Iran currently is being paid for oil sales to India through a Turkish bank, the National Iranian Oil Company has said.

India buys about 400,000 barrels per day from Iran.

Turkey, which opposes unilateral sanctions against Iran, is also a major client, purchasing gas in addition to oil.

The West fears Iran is trying to build a nuclear bomb. Tehran insists its nuclear programme is only for civilian use and refuses to abandon its uranium enrichment activities.