India's central bank said in December that oil and other import payments could not be made through a Tehran-based clearing house which the United States alleges is being used to bypass international sanctions against Iran.

"Efforts are on to find suitable mechanism for payment of current or future oil imports," Minister of State for Finance Namo Narain Meena said in a written reply to parliament late Friday.

Meena's statement appeared to contradict earlier reports that a long-term solution had already been found.

Iran, which is under sanctions over its nuclear programme, is the second-largest crude supplier to India after Saudi Arabia and supplies up to 14 percent of the country's oil import needs. India imports around 80 percent of its crude oil.

After India's central bank ruled that New Delhi could not use the Asian Clearing Union house due to the sanctions, the country has been making piecemeal payments to Iran.

The two sides have been negotiating for more than two months on ways to resolve the payment deadlock on a long-term basis and salvage the trade, which is worth around $12 billion annually.

This month earliar, India's oil minister S.Jaipal said the government had paid $2.1 billion to the National Iranian Oil Co after the back-payment bill reached $4 billion. Jaipal did not say how the payment had been made.

Indian state-owned refiners and privately-held Essar Oil imported 8.9 million tons of crude from Iran in the six months ended September 2010. They imported 21.2 million tons in the last financial year, according to government data.