Iran Crisis: Major Indian firm suspends $400 million worth projects

[Ingis]

The decision was taken by the management of major Indian engineering & construction firm recently due to increasingly deteriorating situation in Iran. Many of these EPC (Engineering, Procurement & Construction) projects were not officially acknowledged because the dealings were taking place through third-party firms based in East Asia. Most of these projects were in the oil, gas & petrochemical sector --

1) Olefin II - Jam petrochemical complex

2) NIOC Abadan refinery complex

3) Ethylene and Propylene Plant - Ilam Petrochemical Complex

4) Tabriz refinery expansion project

5) Morvarid Petrochemical Complex - Ammonia & Urea Complex

$400 million is the total worth of services (primarily detailed engineering & procurement services) carried out by the Indian company so far. The total worth of these projects would easily exceed $1.2 billion.

Due to confidentiality reasons, I cannot reveal the name of the Indian firm and neither will there be any press release by the company. But it is definitely a big loss for the company and its stake-holders.

Anyways, tough economic sanctions against Iran are definitely hurting Indian companies.

 

[longbrained]

Do not worry. Iranian and Chinese engineering firms will take over and the India firm will lose all of its investments in Iran as a result. Loss for India. Indians do not have a strong spine as Chinese have. India will never be an independent global player just a minimal player towing American line.

 

[Ingis]

Do not worry. Iranian and Chinese engineering firms will take over and the India firm will lose all of its investments in Iran as a result. Loss for India. Indians do not have a strong spine as Chinese have. India will never be an independent global player just a minimal player towing American line.

Interesting you would mention Iranian and Chinese companies.

I know in detail about two of these projects - Ilam Ethylene project and Tabriz refinery expansion. The Ilam Project was handed over to the concerned Indian company only after the local Iranian company, BINA Consulting Engineers, failed to meet any of the project deadlines. The project was initially awarded to BINA in 2006.

The Tabriz refinery was initially sent to SINOPEC but the technology licensors, (Shaw Group and Axens) rejected SINOPEC and had instead suggested the Indian firm (this was back in 2008) and that's how the latter got involved.

Anyways, most of these oil & gas projects in Iran have been in limbo for the past 5-6 years, irrespective of the fact whether they are under local, Chinese or Indian firms.

And just to note, the management of the Indian firm has suspended these projects because it considers these projects to be high risk. Its projects in USA and Europe are worth much more than what Iran can offer and therefore, it cannot risk jeopardizing its interests in US and Europe.

But still, the suspension of these projects is definitely a disappointment for the company's stake-holders.

 

[Sugarcane]

Anyways, tough economic sanctions against Iran are definitely hurting Indian companies.

You don't have to forget that these sanctions basically helped Indian to penetrate in Iranian market. You don't face competition because there are only three major players 1) locals 2) India 3) China. As everyone know that India enjoys good diplomatic relation with Iran, so it certainly helped India. Iran is a big market, do you think in absence of these sanction India could have that much domination. Keeping in mind there are lot of European and American etc. tycoons in this business as well. I don't think sanctions hurtled India's business infect she have taken full advantage of it.

Bye they now you are USZ's close friends and your business men are intelligent enough that sooner or later your govt. will back off from Iran under pressure of your new friend. Otherwise there are 101 ways of doing business and hindu bania is intelligent enough when it comes business.

 

[Ingis]

You don't have to forget that these sanctions basically helped Indian to penetrate in Iranian market. You don't face competition because there are only three major players 1) locals 2) India 3) China. As everyone know that India enjoys good diplomatic relation with Iran, so it certainly helped India. Iran is a big market, do you think in absence of these sanction India could have that much domination. Keeping in mind there are lot of European and American etc. tycoons in this business as well. I don't think sanctions hurtled India's business infect she have taken full advantage of it.

Bye they now you are USZ's close friends and your business men are intelligent enough that sooner or later your govt. will back off from Iran under pressure of your new friend. Otherwise there are 101 ways of doing business and hindu bania is intelligent enough when it comes business.

There are currently several EPC oil and gas projects in the Middle Eastern countries (from Oman, to Qatar, to Kuwait) which have been awarded to Indian firms. And these countries do not suffer from any such sanctions. So, your assumption that Indian companies could not have penetrated into Iran without taking advantage of sanctions against Iran is dubious.

Secondly, several Indian firms have made well-established investments in Western countries (for example, Essar operates major steel plants in USA, Reliance Industries has bought billions of dollars worth shale gas deposits in US, Tata is the largest employer in UK manufacturing sector and Infosys campus in US employs hundreds). In contrast, Chinese companies primarily have export-import relationship with the West. Therefore, Indian companies stand to lose more if Western governments impose sanctions against them for dealing with Iran. And hence, they are more cautious while dealing with Iran.

 

[Karachihunk]

Do not worry. Iranian and Chinese engineering firms will take over and the India firm will lose all of its investments in Iran as a result. Loss for India. Indians do not have a strong spine as Chinese have. India will never be an independent global player just a minimal player towing American line.

These firms are there for business and they look after their benefits.Remember Chinese company backed off from Thar coal project in Pakistan.

 

[rai_kamal]

These firms are there for business and they look after their benefits.Remember Chinese company backed off from Thar coal project in Pakistan.

Its true,its completely on the companies to decide whether they want to go or not.
Because its their asset,its not like that today u show courage and if tomorow something happens then they will accuse others.
Still many companies are active there,it won't affect them.Find other indian or chinese company, if they want to come there.

 

[Sugarcane]

There are currently several EPC oil and gas projects in the Middle Eastern countries (from Oman, to Qatar, to Kuwait) which have been awarded to Indian firms. And these countries do not suffer from any such sanctions. So, your assumption that Indian companies could not have penetrated into Iran without taking advantage of sanctions against Iran is dubious.

Secondly, several Indian firms have made well-established investments in Western countries (for example, Essar operates major steel plants in USA, Reliance Industries has bought billions of dollars worth shale gas deposits in US, Tata is the largest employer in UK manufacturing sector and Infosys campus in US employs hundreds). In contrast, Chinese companies primarily have export-import relationship with the West. Therefore, Indian companies stand to lose more if Western governments impose sanctions against them for dealing with Iran. And hence, they are more cautious while dealing with Iran.

We are talking about Iran market, and you started speech , are you trying to say that India has 100% market share in EPC market or you have red some report which predicted that by 20XX India will be sole power in this sector

 

[Sugarcane]

Its true,its completely on the companies to decide whether they want to go or not.
Because its their asset,its not like that today u show courage and if tomorow something happens then they will accuse others.
Still many companies are active there,it won't affect them.Find other indian or chinese company, if they want to come there.

You are right but in some case these companies have to back-off due to political reasons as well. Do you think your govt. wouldn't have clue of losing 1.2b business? Infect these business tycoons knows about political situation even better than politicians because of their relationship with bureaucrats who actually working on policies behind the seen.

 

[opps]

tough economic sanctions against Iran are definitely hurting Indian companies.

Its not economic sanctions against iran thats hurting indian companies but its the indian leadership's pusillanimity to stand against west is hurting indo-iran interests.Its quite open the congress is in hand-in-glove with west on santions against iran, however they pretend overtly but covetely indian govt supports these sanction by self imposing limitation like not paying oil bills on time, pulling out companies,delaying projects etc.

 

[Omar1984]

This will be good for Iran in the long term.

India can never be trusted.

 

[AgnosticIndianNationalist]

^ neither can Pakistan

Pervez Musharraf should have told the truth - YouTube

 

[Ingis]

There are currently several EPC oil and gas projects in the Middle Eastern countries (from Oman, to Qatar, to Kuwait) which have been awarded to Indian firms. And these countries do not suffer from any such sanctions. So, your assumption that Indian companies could not have penetrated into Iran without taking advantage of sanctions against Iran is dubious.

We are talking about Iran market, and you started speech , are you trying to say that India has 100% market share in EPC market or you have red some report which predicted that by 20XX India will be sole power in this sector

So, you interpret "several" as "100%" and "sole"? Go get educated.

 

[FairAndUnbiased]

Interesting you would mention Iranian and Chinese companies.

I know in detail about two of these projects - Ilam Ethylene project and Tabriz refinery expansion. The Ilam Project was handed over to the concerned Indian company only after the local Iranian company, BINA Consulting Engineers, failed to meet any of the project deadlines. The project was initially awarded to BINA in 2006.

The Tabriz refinery was initially sent to SINOPEC but the technology licensors, (Shaw Group and Axens) rejected SINOPEC and had instead suggested the Indian firm (this was back in 2008) and that's how the latter got involved.

Anyways, most of these oil & gas projects in Iran have been in limbo for the past 5-6 years, irrespective of the fact whether they are under local, Chinese or Indian firms.

And just to note, the management of the Indian firm has suspended these projects because it considers these projects to be high risk. Its projects in USA and Europe are worth much more than what Iran can offer and therefore, it cannot risk jeopardizing its interests in US and Europe.

But still, the suspension of these projects is definitely a disappointment for the company's stake-holders.

It is ludicrous to suggest that Chinese companies have lower tech than Indian ones. The amount of patents that India has submitted in its 60 year history do not match up to the number of patents China has submitted in 1 year. Stop being delusional.

 

[Sugarcane]

So, you interpret "several" as "100%" and "sole"? Go get educated.

And when you bhartiis will learn to stick to the topic

several Indian firms have made well-established investments in Western countries (for example, Essar operates major steel plants in USA, Reliance Industries has bought billions of dollars worth shale gas deposits in US, Tata is the largest employer in UK manufacturing sector and Infosys campus in US employs hundreds). In contrast, Chinese companies primarily have export-import relationship with the West. Therefore, Indian companies stand to lose more if Western governments impose sanctions against them for dealing with Iran. And hence, they are more cautious while dealing with Iran.

I think we are talking about Iran specifically, and every market have it's own dynamics. In third world countries you can get contracts by giving kickbacks, that doesn't mean you were superior than others. In Iran it's same even more convenient. If you have been in Iran than you must be know that they prefer European/American products and services over any south asian country. Now don't come up with India's export figure to Iran, I know that and the reason is that those are cheap