By increasing crude oil imports from Iran, India plans to save over $ 8.5 billion in foreign exchange this fiscal, said the Union Petroleum and Natural Gas Minister Marpadi Veerappa Moily. Moily told this to Prime Minister Manmohan Singh in a written communication on August 30. India, which paid about $144.29 billion last fiscal for importing oil, is renewing imports from Iran and, unlike imports from other countries, it pays Iran in rupees.    

He explained in detail about plans to save $ 20 billion in foreign exchange spending through the Iran deal. He added that about 11 million tonne of crude will be imported from Iran in the remainder of the fiscal. About 2 million tonne crude oil has been imported from Iran so far during the current financial year, the Minister said.    

An additional import of 11 million tonne during 2013-14 would result in reduction in forex outflow by $8.47 billion (considering the international price of crude oil at $ 105 per barrel), Moily wrote. The plan is in response to Prime Minister's call to the ministry seeking $25 billion cut in oil import bill to narrow current account deficit.