Focus on long-term energy ties, critical minerals as PM meets Venezuela leader

NEW DELHI: Amid ongoing Indian efforts to diversify its oil supplies, PM Narendra Modi met Venezuela acting President Delcy Rodríguez and discussed ways to deepen the energy partnership that has already seen the Latin American country, which tops the list of countries with largest proven oil reserves, emerge in recent weeks as one of India’s top crude suppliers.

While no agreement was signed, both sides focused on securing long-term energy contracts citing the “perfect complementarity” between the 2 countries in the energy sector.

The PM said in a post on X that they had extensive discussions on expanding cooperation in not just energy but also critical minerals, technology, agriculture, health and people-to-people ties. “As a valued partner in Latin America, our close cooperation with Venezuela holds immense importance for the Global South. We will continue to work together for the mutual benefit of the people of our nations,” said the PM.

After having effectively taken control of Venezuela’s oil industry, the US had pushed India to resume procurement from the country that has in the past been a key energy partner for India. India was one of the largest importers of Venezuelan crude in 2020 when it halted purchases because of US sanctions.

US Secretary of State Marco Rubio had first announced, ahead of his visit to India last month, that Rodriguez would soon be visiting India. According to Indian officials, the message from the acting president was that Venezuela is open for business, and there are great opportunities for India as it looks to diversify its supplies at a time the Strait of Hormuz remains choked by the US-Iran conflict.

“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 demand for many years to come. Therefore, there exists a perfect complementarity for India and Venezuela to work in the energy sector, both upstream as well as downstream,” said MEA secretary (east) Rudrendra Tandon, adding Venezuela has already emerged as the third largest supplier for India this month in terms of spot purchases.

The discussions also focused on expanding cooperation in areas like mining, agriculture, critical minerals and pharmaceuticals. Asked whether the payment for the crude would be made directly to the US or to the Venezuelan government, the official said that the actual work will be done by commercial entities, both in the public sector as well as the private sector.

“All these companies are companies that operate at the global level in global markets. So, they will have to consider the existing payment methods that are going to be adopted when you do economic activity in Venezuela,” said Tandon.

On details of the energy partnership both sides are looking to forge, the official said that oil exporters realise the importance of India as a stable and long-term buyer. “So, it is in their interest to enter into long-term contracts rather than do spot buying. We hope that at some stage, we move forward to long term secure supplies from all our suppliers,” said the official, adding that the Indian refining industry is well equipped to handle Venezuela’s “hard” crude.

According to the MEA, during her 5-day working visit to India, Rodriguez will visit several sites connected with energy, pharmaceuticals and auto sectors to gain insights into India’s technological and industrial capabilities and to explore opportunities for collaboration.