Natwar Singh said he will not step down and said he has the support of his Congress party and the prime minister, the BBC reported Sunday.
Singh was implicated in a report detailing the ongoing investigation into the oil-for-food program.
Former U.S. Federal Reserve chairman Paul Volcker was tapped by the United Nations to conduct the inquiry into whether Saddam Hussein was paid kickbacks despite sanctions.
India's opposition BJP party is calling for Singh's removal.
The Indian government said it will further investigate the U.N. report's accusations and called on Volcker to produce evidence of any wrongdoing.