India and Venezuela on Thursday explored ways of forging an energy partnership during the visit of acting President Delcy Rodriguez.
The South American country, which had almost no contribution to India’s oil basket at the start of the year, has this month become the third-largest supplier of crude in spot purchases.
An energy partnership was on top of the agenda of Rodriguez’s meeting with Prime Minister Narendra Modi during their delegation-level talks, which extended over a working lunch, the secretary (east) in the external affairs ministry, Rudrendra Tandon, said during a briefing.
“Venezuela possesses one of the largest oil reserves in the world. The Indian economy is a large and growing consumer of oil, and will have a stable demand growth for many years to come. Thus, in the energy sector, we see a perfect complementarity. In fact, in our spot purchases, Venezuela has already emerged as the third-largest supplier this month. So quite naturally, today’s discussion focused on forging an energy partnership,” Tandon said.
“What did emerge from the interaction of the two leaders was that the Venezuelan energy sector is undergoing a fundamental transformation. They see India as a stable demander for many years to come and, therefore, there exists a perfect complementarity for India and Venezuela to work in the energy sector, both upstream as well as downstream,” Tandon added.
As part of the plan to forge an energy partnership, the acting President is also being “exposed to the sophistication we have acquired in the energy industry, whether it is upstream or downstream”.
Tandon confirmed that Rodriguez would visit Jamnagar, where Reliance runs the world’s largest single-site integrated oil refining hub.
Rodriguez will also visit a pharma company in Delhi and a Tata Motors facility.
Energy cooperation apart, the two sides discussed broadening the economic partnership to other areas.
Stating that Venezuela is a large resource-rich country that is showing signs of moving to the path of sustained growth, Tandon said there were huge opportunities not just in the energy sector but also in mining, animal husbandry, transportation, agriculture equipment, automobiles and pharmaceuticals.
The intent is to work out ways in which Indian commercial entities can enter the Venezuelan market, Tandon said.
While the secretary sidestepped a question on how Indian business interests would be insulated from sanctions like the ones imposed by the firstDonald Trump administration in 2019, he confirmed that Indiahad brought up the issue of payments and dividends owed to Indian pharma companies and oil joint ventures. Tandon added that Venezuela was sensitive to this.
“There is an acknowledgement from the Venezuelan side that India has stood by Venezuela in good and bad times. It’s a long relationship and we are a preferred partner going into the future,” he said.
Tandon was asked whether payments for Venezuelan oil were going to the government in Caracas or the US Treasury, since Washington was overseeing the sector after the ouster of former Venezuelan President Nicolas Maduro.
“Venezuela is undergoing a transition period. There are arrangements in place. When we speak about building an economic partnership, the actual work will be done by commercial entities both in the public and private sector in India,” Tandon said.
“All these companies are those that operate at the global level in the global market. They will have to take into account the existing payment methods that are going to be adopted when you do economic activity in Venezuela.”
On the pharma sector, he said there was a detailed discussion on Indian manufacturers’ ability to produce high-quality generic drugs at low cost.
Prime Minister Modi suggested that one of the ministers accompanying Rodriguez should be exposed to the Jan Aushadhi programme under which generic drugs are sold at lower prices.