by Santanu SaikiaIt's the biggest NAME for Indian diplomacy after the now-obsolete NAM! After all, in the redefined unipolar world we live in, Panscheel is, at best, a faded and forgotten sepia-tinted memory. The demise of the Soviet Union, the death of NAM, the burial of ideology -- the cremation of the raison d'aitre of Indian foreign policy of yore? Where does that leave Indian diplomacy? In the right here, right now for India, it's oil diplomacy which is fast-emerging as the corner-stone of international relations.
Thanks to the voracious, insatiable appetite of the cash-rich Indian oil majors, the quest for equity oil deals continues unabated. Indian diplomats have been forced to reinvent, and rediscover, themselves -- as indeed the vocation they have been trained in. The phlegmatic, clich-ridden diplomatic dialogue of the past has now given way to hard, behind-the-scene maneuvering -- with governments in
countries as far-flung as Ecuador, Cuba, Sudan, Angola, Russia, Kazakhstan, Libya, Iran, the Ivory Coast, in large tracks of Africa, Latin America, East Europe and West & South East Asia. In their new avatar, Indian diplomats -- be it in Khartoum, Luanda, Kremlin, Havana, Abidjan, Caracas, Teheran, Quita, Libreville, Baku -- the list of these hard-to-pronounce cities is endless -- are in in conversation with their host countries on multi-million dollar oil deals. And, it is as a result of these efforts on the part of Indian oil companies that Indian foreign policy itself seems to have been given a new fillip. To put it in perspective, India's search for oil security -- with plans to acquire a massive 60 MMTPA of O+OEG by the year 2025 -- is redefining the very basis of Indian diplomacy in large lesser-known parts of the world. The change is grudgingly accepted by South block, which now sees oil diplomacy as a major plank of India's foreign policy thrust. To quote some recent examples of oil diplomacy in action, we present three case-studies:
At the centre of all this action, of course, is petroleum minister, the redoubtable Mani Shankar Aiyar, he of the "once-upon-a-time-I-was-a-diplomat" fame. His Shastri Bhawan office could, no doubt, give South Block a run for its money and the reception to his trips to Vienna and Moscow could give foreign minister Natwar Singh a complex! At Vienna -- where he was especially invited to address a meeting of key OPEC ministers -- and Moscow -- where he proposed a grand alliance between Russia and India -- he impressed his hosts with a daring-do attitude. And, be it the visit of the Pakistani Prime Minister -- during which the transnational gas pipeline figured prominently -- or the forthcoming visit of Russian premier Putin -- during which some oilfields deals are likely to be signed -- Aiyar and oil diplomacy are where it's at. His upcoming trip to Tehran to strike a 5 MMTPA LNG deal and his impending visit to Bangladesh for the SAARC summit (and then onward to Yangon) are just a further extension of this. For, especially in countries where equity oil properties are still available, politics -- and diplomacy -- often play as significant a role as the economics of oil. Aiyar recognises this and hinges his efforts on diplomatic strategy. Towards this end he has brought in specialised diplomatic inputs into the petroleum ministry. The hiring of an additional secretary from MEA to oversee OVL's deals abroad and the appointment of an advisory committee of veteran diplomats and foreign policy experts, are steps in this direction. Ultimately, however, the proof of the pudding is in its eating and Aiyar will just have to show tangible results, so far elusive. The fact that the Chinese have snatched away a deal which India had struck on Block 18 is testimony of the intense global competition that the battle for cornering oil reserves is marked by. It's slippery, slimy business -- this oil -- which requires slick, smooth operators. Does Mani and his diplomatic band fit the bill? Well, the instruments have been tuned but the prima donna hasn't struck the note just yet.
Thanks to the voracious, insatiable appetite of the cash-rich Indian oil majors, the quest for equity oil deals continues unabated. Indian diplomats have been forced to reinvent, and rediscover, themselves -- as indeed the vocation they have been trained in. The phlegmatic, clich-ridden diplomatic dialogue of the past has now given way to hard, behind-the-scene maneuvering -- with governments in
countries as far-flung as Ecuador, Cuba, Sudan, Angola, Russia, Kazakhstan, Libya, Iran, the Ivory Coast, in large tracks of Africa, Latin America, East Europe and West & South East Asia. In their new avatar, Indian diplomats -- be it in Khartoum, Luanda, Kremlin, Havana, Abidjan, Caracas, Teheran, Quita, Libreville, Baku -- the list of these hard-to-pronounce cities is endless -- are in in conversation with their host countries on multi-million dollar oil deals. And, it is as a result of these efforts on the part of Indian oil companies that Indian foreign policy itself seems to have been given a new fillip. To put it in perspective, India's search for oil security -- with plans to acquire a massive 60 MMTPA of O+OEG by the year 2025 -- is redefining the very basis of Indian diplomacy in large lesser-known parts of the world. The change is grudgingly accepted by South block, which now sees oil diplomacy as a major plank of India's foreign policy thrust. To quote some recent examples of oil diplomacy in action, we present three case-studies:
- It was Ashok Kumar, India's ambassador in Khartoum, who had to take the rap from an irate Hamad Neel, the acting secretary general in Sudan's Ministry of Energy and Mining when Neel accused India of not living up to its end of what was, at best, a hazy deal. The deal in question involved revamping a refinery in Port Sudan and building a new 700 km Port Sudan-Khartoum pipeline in return for permissions to acquire significant stakes in the lucrative Sudanese oil fields by ONGC Videsh Ltd. (OVL). The ONGC subsidiary refused to undertake the revamp of the refinery when it learnt that the configuration demanded by the Sudanese would come with a price tag of a whopping $one billion. OVL also insisted that the Sudanese should foot the hefty bill for taking out a political insurance cover for the $200 million pipeline project. The Sudanese official summoned the Indian ambassador and told him that his country had felt "insulted" by OVL's intransigence and that something should be done quickly to retrieve/assuage the situation. Ashok Kumar immediately flashed an alert to South Block, which, in turn, suggested to the petroleum ministry that remedial action was needed to help avert a confrontation. The end result: OVL was directed to bear the insurance cover from its own pocket and conduct a feasibility report on revamping the refinery according to the configuration demanded by the Sudanese.
- On October 10, 2004, Ravi Mohan Aggarwal, the Indian Ambassador in Luanda, received an urgent message from New Delhi to seek an appointment with the Angolan foreign minister Joo Bernado de Miranda. Aggarwal's job was to garner Miranda's support for the Indian takeover of RoyalDutchShell's 50% stake in Block 18 in offshore Angola for $600 million. The Angolan state oil company Sonangol had decided to invoke its right of first refusal and the Indian government was launching a last-ditch effort to save the deal. Aggarwal did meet Miranda on October 1, but by that time the Angolans had already sealed the deal and, according to the latest reports, Sonangol is planning to vest its acquired stakes to a Chinese company.
- The Indian ambassador in Russia is today a familiar face at the Ministry of Natural Resources of the Russian Federation in Kremlin. He has been seen vigorously cracking the infamous Russian bureaucracy to push through government sanctions for the $12 billion Sakhalin-1 project in which India has a 20% stake. He is currently busy stitching together an Indo-Russian partnership in the petroleum sector which is expected to be announced during Russian president Vladimir Putin's forthcoming visit to New Delhi. The ambassador is also part of the hectic behind-the-scene negotiations between Russian major Gazprom and Indian duo ONGC and IOC for a possible joint bid for the troubled Yokos subsidiary, Yuganskneftegas. The reserve price for the deal has been pegged at a whopping $8.6 billion.
At the centre of all this action, of course, is petroleum minister, the redoubtable Mani Shankar Aiyar, he of the "once-upon-a-time-I-was-a-diplomat" fame. His Shastri Bhawan office could, no doubt, give South Block a run for its money and the reception to his trips to Vienna and Moscow could give foreign minister Natwar Singh a complex! At Vienna -- where he was especially invited to address a meeting of key OPEC ministers -- and Moscow -- where he proposed a grand alliance between Russia and India -- he impressed his hosts with a daring-do attitude. And, be it the visit of the Pakistani Prime Minister -- during which the transnational gas pipeline figured prominently -- or the forthcoming visit of Russian premier Putin -- during which some oilfields deals are likely to be signed -- Aiyar and oil diplomacy are where it's at. His upcoming trip to Tehran to strike a 5 MMTPA LNG deal and his impending visit to Bangladesh for the SAARC summit (and then onward to Yangon) are just a further extension of this. For, especially in countries where equity oil properties are still available, politics -- and diplomacy -- often play as significant a role as the economics of oil. Aiyar recognises this and hinges his efforts on diplomatic strategy. Towards this end he has brought in specialised diplomatic inputs into the petroleum ministry. The hiring of an additional secretary from MEA to oversee OVL's deals abroad and the appointment of an advisory committee of veteran diplomats and foreign policy experts, are steps in this direction. Ultimately, however, the proof of the pudding is in its eating and Aiyar will just have to show tangible results, so far elusive. The fact that the Chinese have snatched away a deal which India had struck on Block 18 is testimony of the intense global competition that the battle for cornering oil reserves is marked by. It's slippery, slimy business -- this oil -- which requires slick, smooth operators. Does Mani and his diplomatic band fit the bill? Well, the instruments have been tuned but the prima donna hasn't struck the note just yet.
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