Industry sources told Sputnik that both countries are in consonance over the barter-like system, wherein Iran would allow India to make a portion of oil payments in Rupee through the state-run UCO Bank, which has no USA exposure.
Iran, being one of India's top oil suppliers, boasts a long-standing political and economical relationship with New Delhi.
Minister of External Affairs Sushma Swaraj on Monday met her Iranian counterpart Javad Zarif to discuss bilateral relations following USA's pull out from the Joint Comprehensive Plan of Action or Iran nuclear deal.
India continued to trade with Iran throughout previous sanction periods, but was forced to cut oil imports as sanctions choked off banking channels and insurance cover for tankers.
The State Department also is scrambling to respond to Iran's efforts by building a counter-coalition aimed at isolating Tehran and any nation that works with Iran to skirt new US sanctions, USA officials told the Washington Free Beacon.
"India follows only United Nations sanctions, and not unilateral sanctions by any country", she said at a news conference in response at a question on India's response to the USA decision.
India trades with Iran in Euros, which are not under the purview of the US Department of the Treasury. Iran has already invited Pakistan to become a part of the Chabahar development process - a call that would leave New Delhi jittery.
India does $115 bn in annual trade with the United States, but that with Iran is $13 bn a year.
India is the world's third-biggest oil consumer. That $115 bn per annum in trade that India does with the United States is a fraction of that of countries like China or South Korea, and numerous firms that deal with Iran likely have no USA assets that could be attached.
In case Venezuelan dictator Nicolas Maduro and Iranian President Hassan Rouhani were anxious about the next round of sanctions coming their way, they received some good news this week.
He said new USA legislation would inject flexibility for countries dependent on Russian equipment, but America's concerns about the S-400 sale were "completely separate from any sanctions or legislation".
What's more of a puzzle, though, is why they continue to support Venezuela.