"We are proceeding with our talks with Tata. But the pace of discussions is not satisfactory," B Afshar, head of international co-operation division of Ikco, said in response to a questionnaire sent by e-mail.

Ikco had started negotiations with Tata Motors to source cars in the A and B segments. This would have meant Tata Motors shipping its Indica to Ikco in Iran.

"We believe that we can establish strategic cooperation with Indian car manufacturers class to fulfill the demand of the Indian car market in the economy segment," Afshar said.

Saying that the company had set a deadline to strike a deal with Indian automakers by the end of this year, Afshar said the company is talking to other companies also.

"We believe that we can mutually cooperate with Indian car manufacturers. So we are arranging discussions with the other Indian car manufacturers since we do not want to lose the opportunity of mutual cooperation with Indian car manufacturers," he added.

When contacted, a Tata Motors spokesperson said: "Iran is definitely a market of interest for Tata Motors. We are still in talks with Ikco."

She refused to give any further details on negotiations with the Iranian company. Afshar also indicated that Ikco might scout for similar opportunities in other countries including China if it fails to strike a deal with Indian by the end of this year.

"Other opportunities are also arising for Ikco, specifically in China," he said.

Ikco is the largest vehicle manufacturer company in Iran, having an average share of 65 to 70 per cent of domestic vehicle production.