Workers lift a sack of rice to load onto a truck at a wholesale grain market in the northern Indian city of Chandigarh February 9, 2012. A payment problem over Indian rice exports to Iran will “unlock itself” once the trade settlement mechanism gets sorted out, India's trade secretary Rahul Khullar said on Thursday. -Reuters Photo

NEW DELHI: India Thursday said it would send a “huge” trade mission to Iran to explore business opportunities created by sanctions imposed by the West over the Islamic Republic's disputed nuclear programme.

The European Union earlier this month agreed to an embargo on Iran's vital oil exports as part of an intensifying US-led campaign aimed at forcing Tehran to abandon its nuclear programme.

“We will be mounting a mission to Iran at the end of the month to promote our own exports. A huge delegation will be going,” Commerce Secretary Rahul Khullar told reporters in New Delhi.

The delegation will include government officials and representatives from trade and industry, he said.

Iran is India's second-largest oil supplier after Saudi Arabia, providing around 12 per cent of the fast-growing country's crude needs.

India says it will abide only by UN sanctions not implement those by individual nations or groupings.

The country has been examining ways to step up trade with Iran amid trouble in settling its oil bills from Iran as a result of the sanctions campaign that is drying up banking routes.

India's Economic Times reported on Thursday that New Delhi had proposed paying for crude imports with wheat exports to the Islamic Republic.

Indian government officials said large business opportunities had opened up in Iran in wake of the US and European sanctions.

“If Europe and the US want to stop exports to Iran, why should I (India) follow suit? Why shouldn't we tap that opportunity?” an unnamed government official was quoted as saying by the Press Trust of India.

India believes large export opportunities are available in the food sector, including tea, wheat and rice; pharmaceuticals; iron and steel and infrastructure projects, officials said.

Bilateral trade between India and Iran is around $13.6 billion, of which Indian exports account for just $2.74 billion.

Finance Minister Pranab Mukherjee, during a recent US visit, said it was impossible for energy-hungry India to “reduce the imports from Iran drastically”, he said.

“Iran is an important country for India despite US and European sanctions on Iran,” he said.

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