India makes $550 mln oil payment to Iran - sources

NEW DELHI, June 26 Thu Jun 26, 2014 8:47am EDT

NEW DELHI, June 26 (Reuters) - India made a $550 million payment to Iran on Thursday to partly clear pending oil dues, under an interim deal that allows Tehran access to $4.2 billion in blocked funds globally, industry and government sources said.

Asian buyers such as Japan and South Korea have cleared some of their oil dues as per a payment schedule approved by world powers in a breakthrough deal with Iran in November.

Iran wanted the last three installments, totalling $1.65 billion, from India. New Delhi could not, however, remit the funds as the banking channel to make payment was not established.

A mechanism now in place allows Tehran to be rewarded for cooperating in talks with world powers over its nuclear programme, while meeting a U.S. insistence that the funds can be properly tracked, sources say. (Reporting by Nidhi Verma; Editing by Douglas Busvine)

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