Iran signs up for more trade with RI

Novia D. Rulistia ,  The Jakarta Post ,  Jakarta   |  Mon, 05/12/2008 10:51 AM  |  Business

Iran, which has just signed two large project deals with Indonesia, aims to soon take up around 1 percent of Indonesia's annual international trade value, says the Iranian ambassador for the country.

"Currently, the trade value between Indonesia and Iran stands at around US$500 million, still a quarter from our target," Behrooz Kamalvandi said, as quoted by Antara.

Last year, trade relations between the two countries reached $553.1 million, a 37 percent increase from the $404.4 million recorded in the previous year, according to the Trade Ministry.

Kamalvandi added the country was on its way to achieving the target.

"Iran and Indonesia have signed deals on two large projects. First is a refinery in Banten with a total investment of $6 billion and the second is the construction of a fertilizer factory, known as the Hengam project, in southern Iran, with a total investment of $700 million," he said.

For the refinery project, scheduled for completion in 2012, Iran will provide around 150,000 to 180,000 barrels of oil per day, equal to 12-14 percent of Indonesia's total oil demand, Kamalvandi said.

"Some of the fuel produced from the refinery will be exported to Iran with the value of about $2 billion annually."

Indonesia and Iran will each finance 40 percent of the refinery project and the remainder 20 percent will come from Malaysia.

As for the fertilizer plant, Iran will export about 1 million tons of fertilizer to Indonesia.

The two projects are estimated to produce 2,500 tons of urea and ammonia per month.

"Indonesia and Iran still have potential in sectors which have not been explored yet. We will keep trying to find ways so big project deals can be made in order to maximize this potential," Kamalvandi said.

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