NEW DELHI: Iran has accorded India priority status for trade and investment in acknowledgement of the country’s support during tough times when the United States and European Union had imposed economic and military sanctions on it.

India is among the three countries, along with Turkey and China, with which Iran wants to collaborate in seven sectors including mining, petrochemicals and food.

A delegation led by the Federation of Indian Export Organisations (FIEO) president SC Ralhan recently visited Iran, while the Iranian minister for trade is expected to visit India next month.

The two nations are likely to have a joint consultative meeting in January next year to thrash out the details of the proposed engagement. “Iran wants to reinforce its relationship with countries which stood by it during its difficult times. Hence, it is reciprocating by giving preference to them,”¬†said Ajay Sahai, director general of FIEO.

In 2006-07, when the United States and the EU had imposed sanctions on Iran, India kept exporting commodities like rice, sugar and soybean, along with textiles, and also importing crude oil in large quantities. Earlier this year, the government had issued guidelines to allow third country exports of humanitarian goods such as food, medicines and medical equipment to Iran as part of oil payments due to that country.

In 2014-15, India’s exports to Iran stood at $4.17 billion while the imports amounted to $8.95 billion, an increase from $1.44 billion and $7.61 billion, respectively, during 2006-07.

Among other sectors, Iran is also looking at cooperation in agroprocessing, information technology, steel and hotels/tourism.

India, on its part, is also eyeing investments in Iranian ports. Road transport, highways and shipping minister Nitin Gadkari has said that India plans to invest almost Rs 2 lakh crore at Chabahar port in Iran in various infrastructure projects.

India has been in talks with Iran to set up a gas-based urea manufacturing plant at the port which is being developed as both a strategic and economic asset, efforts for which were initiated in 2001 when the then Prime Minister Atal Bihari Vajpayee visited the Persian Gulf country.

ET view: To Iran we must go

Post nuclear deal with the US, Iran is likely to want to renegotiate terms with India, as it shops around for the best options. Sectors like pharma and IT are new areas which India could explore, while expanding existing opportunities.

For India, Iran can provide the market that could provide an impetus for its Make in India initiative. While the past is something that New Delhi can, and must, leverage, it also needs to move decisively to secure opportunities for its businesses, and to secure its strategic interests in Central Asia.