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WASHINGTON: The Obama administration is keeping India on tenterhooks after excluding it from an ’’initial’’ list of eleven countries it said would be exempt from sanctions because they had ’’significantly’’ reduced oil purchases from Iran.
 
Countries off the hook are close US allies Japan and the United Kingdom, and nine other EU countries including Belgium, the Czech Republic, France, Germany, Greece, Italy, the Netherlands, Poland, and Spain.
 
Those still in the dock are China and India, among Iran’s largest oil buyers, and, in an indication that even recalcitrant allies will not be spared, South Korea, which another top Iranian oil client. A total of 23 countries import oil from Iran which means a dozen countries are now on notice for US sanctions.
 
In a statement on Tuesday, Secretary of State Hillary Clinton said she will report to Congress that financial institutions from the 11 compliant countries be exempt from sanctions pursuant to falling in line with US law, a section of the National Defense Authorization Act for 2012 which seeks to shrink Iran’s oil export markets and isolate its Central Bank from the world financial system.
 
’’The actions taken by these countries were not easy,’’ Clinton said, referring to Japan+10 (many of who have slowing economies) who will escape sanction. ’’They had to rethink their energy needs at a critical time for the world economy and quickly begin to find alternatives to Iranian oil, which many had been reliant on for their energy needs.’’
 
Japan, in particular, came in for praise for giving up Iranian crude oil purchases, with Clinton saying it was ’’noteworthy considering the extraordinary energy and other challenges it has faced over the past year.’’
 
India has contested the US assertion that it is not showing a reduction in Iranian oil purchases and informed Washington that since its annual crude contracts with Teheran runs Iran April to March, the decline will start to showing from next month.
 
New Delhi has about an eight-week window to scale down Iranian oil imports since the sanctions provision of NDAA2012 kicks in only if countries don’t make ’’significant’’ cuts in their Iranian crude oil purchases during the first half of this year.
 
But in a separate background briefing, a senior administration official said a Presidential determination whether or not sanctions related to petroleum and petroleum products come into effect on June 28th could come by March 30th, giving India only a week to make its case.
 
The US law does not specify by what percentage a nation must reduce its imports to qualify for an exemption, but the Obama administration has informally indicated that it was be happy with a minimum 15 per cent subject to each country’s circumstances. India is shooting for a 10-12 per cent cut before the US law goes into effect on June 28.
 
The administration official who spoke on background held up Japan, which he said has reduced Iranian oil imports by 15-22 per cent as a benchmark. ’’That gives some indication of what a particularly country was able to do in a situation of hardship, and we look forward to countries that are importers of Iranian crude oil to come back to us looking at the Japan example, the European Union example, and to give - indicate to us what they believe that they are able to do,’’ he said.
 
Unless it is intent on poking the US-led alliance in the eye in the effort to corral Iranian nuclear programme, New Delhi can also take heart from Clinton’s reference to the ’’initial’’ list of sanctions-exempt countries, which means more let-offs are in the pipeline subject to compliance.