India asks state banks to withdraw cash held abroad over Cairn dispute: Report

India has asked state-run banks to withdraw funds from their foreign currency accounts abroad, two government officials and a banker said, as New Delhi fears Cairn Energy may try to seize the cash after an arbitration ruling in a tax dispute.

Cairn was awarded damages of more than $1.2 billion plus interest and costs in December in a long drawn-out tussle with the Indian government over its retrospective tax claims.

While New Delhi has filed an appeal, the London-listed firm has started identifying Indian assets overseas, including bank accounts, that could be seized in the absence of a settlement, which Cairn says it is still pursuing.