Iran has agreed to be paid 45 percent of revenue from its Indian oil exports in rupees, to be deposited with an Indian bank beyond the reach of new US and European sanctions, a report said Thursday.

The two countries have chosen UCO Bank, headquartered in the eastern city of Kolkata, for the rupee transactions to settle part ofIndia's $12.68-billion annual oil bill, The Indian Express reported.

India currently pays for 20 percent of its oil imports from Iran in rupees, with the remainder settled in euros at the Turkish bank, Turkiye Halk Bankasi.

There are concerns that the Turkish route will be closed by tough new European sanctions on oil exports from Iran imposed over the Islamic Republic's disputed nuclear programme.

India has said it will continue to buy crude from Iran despite moves by the US and Europe to further isolate the country, which accounts for 12 percent of India's annual oil imports.