It blamed the economic crisis and the reluctance of lenders to provide money due to Iran’s ‘geo-political situation.’

The project was announced in 2007 in which Nalco had planned to ferry bauxite to the proposed project from tits Indian mines and convert it into aluminium.

It signed an agreement with Iran’s Kerman Development Organisation, but an agreement to form a joint venture was not floated. The original cost of the project was around INR80bn ($1.73bn) but has now risen to INR100bn ($2.17bn).

When a Parliamentary Standing Committee recently asked the union mines ministry to comment on the fate of the Iranian venture, the ministry said it was unwilling to proceed saying it had both financial and geo-political constraints.