Oil refining capacity in Asia's third-largest economy will rise by about 61 percent to 310.9 million tons a year or 6.22 million bpd by March 2017.

"We said they should try to organize 4-5 million tons of oil more each passing year ... every year," S. Jaipal Reddy told reporters after a meeting with Deputy Oil Minister Abdul Aziz bin Salman.

"I wish to make it emphatically clear that our relationship with Saudi Arabia is purely bilateral. It is our single biggest supplier. We have been seeking every year to increase supply.

"It is the same this year. It has no relationship to our relationship with any other country in the world, including Iran," Reddy said, adding volumes from Iran in 2012/13 would be "almost similar" to those this year.

Abdul Aziz said Saudi Arabia's concern is to keep the global oil market well supplied. "This is not an issue for us. We are concerned with maintaining the market well supplied, and that has always been our endeavor," Abdul Aziz said, referring to the oil embargo on Iran.

"We have demonstrated to our friends that this market is well supplied ... that how much excess capacity there is today and how much capacity will there be in future."

Asked if oil prices will rise further if supplies from Iran drop, the minister, in New Delhi on an official visit, said: "We don't engage ourselves in any of these discussions."