India and Venezuela Discuss Oil and Mining Cooperation

Prime Minister Narendra Modi met with Delcy Rodriguez, Venezuela’s Acting President, in New Delhi to discuss opportunities in the oil and mining sectors. The talks, which took place on Thursday, aimed to set a political consensus that would encourage engagement between Venezuela and Indian businesses.

Rudrendra Tandon, Secretary (East) in India’s Ministry of External Affairs, highlighted that Venezuela is endowed with one of the largest oil reserves globally, making it an attractive partner for India, a major oil consumer. He noted: “In the energy sector, we see perfect complementarity. In our spot purchases, Venezuela has emerged as our third largest supplier this month.” Tandon mentioned that Venezuela’s energy sector is experiencing significant changes, with Indian demand projected to remain stable for many years.

Rodriguez's visit to India marks her first working trip in her current capacity after several prior visits in different roles. For India, this visit occurs amid efforts to diversify its energy sources as tensions in West Asia have led to increased oil prices. Following military conflicts involving the United States, Israel, and Iran, oil supply routes like the Strait of Hormuz have become critical concerns, impacting global energy exports.

Historically, Venezuela has faced challenges due to sanctions imposed by the US government during Donald J. Trump’s presidency in 2019. These sanctions prompted Indian firms to decrease imports of Venezuelan crude oil. Furthermore, Indian companies such as ONGC Videsh Ltd. and various pharmaceutical firms have been affected by unpaid dividends from Venezuela, estimated at around $500 million to OVL and at least $700 million to pharmaceutical companies.

The unpaid dues were a key topic of discussion during Modi and Rodriguez's talks. Tandon stated, “The dividend issue did come up several times in discussions with Venezuela. They are very sensitive to the issue.” He added that the Venezuelan authorities are aware of outstanding payments, which will continue to be part of future discussions.

Despite unresolved issues, discussions at the delegate level persisted during a working lunch that focused on mutual interests in energy and mining. The Indian government has shown a keen interest in reestablishing ties with the Venezuelan economy, particularly in light of recent changes in the US sanctions regime. Following a military raid on Caracas in January that resulted in the arrest of Venezuelan President Nicolas Maduro, there were indications that the US had eased some restrictions.

Moving forward, Tandon made it clear that Indian businesses intending to purchase oil from Venezuela must adhere to existing payment arrangements. He mentioned that companies “have to take into account the existing payment methods” while engaging in business transactions in Venezuela.

The leaders also discussed Venezuela's current political situation, noting that India expressed significant concern following recent events. Tandon emphasised India's desire to collaborate with the current Venezuelan administration, describing it as “friendly” towards India.

Additionally, the dialogue included potential mining sector cooperation, highlighting that this will be driven by industry rather than government mandates. Historically, India and Venezuela shared a robust economic relationship centred on crude oil imports until 2019.

Rodriguez aims to visit key industrial centres in New Delhi and travel to Gujarat to gain insight into India’s expanding oil refining capabilities. Furthermore, she is set to make a personal visit to Puttaparthi, the birthplace of Sathya Sai Baba, who is known to be one of her inspirations.