India seeks to break deadlock with Iran over tanker

The Wall Street Journal

By Biman Mukherji

NEW DELHI—Indian government officials will meet Iranian diplomats in New Delhi on Wednesday in an attempt to resolve a dispute over an Indian oil tanker that Iranian naval authorities detained last week, alleging that the ship was polluting Iranian waters, an Indian executive said.

Iran's move to detain the ship, which was carrying crude oil from Iraq to India, puts it at odds with one of the few destination countries for its oil, as the two countries have worked out a system to skirt Western sanctions whereby India places rupee-denominated payments in an Indian bank to pay for oil and funds are debited from the account when Iran purchases Indian goods that may include grains, drugs, consumer products and auto parts.

An executive with state-run Shipping Corp. of India, the owner of the tanker, told The Wall Street Journal that Tehran said it won't release the vessel until it receives "guarantee money" from India that could be used to pay compensation for the environmental damage caused by the ship.

This echoes an Iranian Labour News Agency report Wednesday quoting Mohammad Reza Ghaderi, the director general of the Ports and Maritime Organization's Marine Safety and Environment Protection department, as saying the ship would be released when Iran obtains guarantees from its insurer, P&I club insurance company, that compensation is forthcoming.

An Iranian official said previously that an inspection of the vessel had turned up extensive violations of regulations, including a nonfunctioning oil-and-water separation device.

An Iranian court will determine the compensation amount, ILNA reported

Iranian embassy officials in New Delhi weren't immediately available, and a spokesman for India's foreign ministry didn't immediately respond to requests for comment.

Shipping Corp. of India executives have said that the tanker wasn't in the vicinity of Iranian waters when it was detained last Tuesday, and they aren't amenable to paying compensation.

Indian government officials have said that Iran detained the vessel without provocation.

"There is no progress at the moment," the Shipping Corp. executive said, adding that "top government officials will be participating in the meeting."

In a statement late Friday, Iran's embassy in India said that the ship's detention "is purely a technical and nonpolitical issue."

According to the embassy, the tanker was detained following a warning from the Marine Emergency Mutual Aid Center, a Bahrain-based organization with a mission to fight marine pollution.
—Benoît Faucon, Preetika Rana and Saurabh Chaturvedi contributed to this article.