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On eve of Iran nuclear talks, sanctions bite

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Some companies have closed down. "Factories cannot find raw materials and spare parts, and have stopped operating," Karim Pakravan, a DePaul University finance professor, told Voice of America.  "The Iranian market also has been invaded by much cheaper Chinese goods and those will continue to undercut Iranian industry."  

Then there’s the embargo of Iranian oil by European and other nations. As OPEC’s second-largest oil producer with the third-largest oil reserves globally, Iran has a lot to lose if oil sales or production goes down.  A report by the US Energy Information Administration (EIA) released Tuesday said that the present unfavorable investment climate in Iran could curtail the country’s oil output by 15 percent, a decrease of 500,000 barrels per day from 3.55 million last year..

"A number of foreign companies that were investing in Iran's upstream have halted their activities as a result of previous sanctions against Iran," it said.

China and India have not joined the embargo, but are capitalizing on Iran’s financial vulnerability to gain commercial advantage.

“India has used the payments difficulties to force concessions from Iran, including an Iranian acceptance of payment for about 45 percent of the oil sales in rupees, India's local currency, but which is not convertible,” according to a recently released Congressional Research Service (CRS) statement. “The remainder might be settled through barter trade or Indian investment in Iran, and some might be settled in gold.“ 

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