New Delhi (Sputnik): In a major indication that India is in no mood to buckle under US pressure, New Delhi has already started the process to make sure that purchases of crude oil from Venezuela would not be impacted in the absence of a sanction-proof payment system.
A government official told Sputnik that making payments in India's national currency is being considered, but that the proposal is at the initial stage.
"Following a proposal from Venezuela and suggestion from refiners in India, the oil ministry has proposed setting up an alternative mechanism whereby entire payment will be made in rupee", an official told the newspaper Economic Times, adding that it is aimed to be like the one available for sanctions-hit Iran, which currently supplies India with about 300,000 barrels per day.
Yogesh Baweja, the spokesperson for India's Ministry of Petroleum and Natural Gas, told Sputnik that he is not denying the report, but declined to divulge further details.
India's Oil Minister Dharmendra Pradhan met with Major General Manuel Quevedo Fernandez, Venezuela's oil minister, on the side-lines of Petrotech 2019 on 11 February 2019 and "discussed further strengthening oil and gas cooperation between the two countries".
Met HE Major General Manuel Quevedo Fernandez, Min. of Petroleum, Venezuela on the sidelines of @Petrotech2019.— Chowkidar Dharmendra Pradhan (@dpradhanbjp) February 11, 2019
Congratulated HE Fernandez on taking over the Presidency of #OPEC for 2019. Discussed further strengthening Oil & Gas cooperation between India & Venezuela. pic.twitter.com/bS9pS3FzL4
"Also explored possibilities for Indian investments in Venezuela's producing blocks", Pradhan said after the meeting.
US President Donald Trump's administration has imposed a series of sanctions against Maduro's government, his political allies and Venezuela's state-owned oil company PDVSA since recognising opposition leader Juan Guaido as the country's interim president at the end of January. Current sanctions bar US firms from doing business with Venezuela, but leave importers from India and other countries unaffected.
India is the third-biggest buyer of Venezuelan oil, after the US and China, averaging about 340,000 barrels a day last year. India's private refiners — Reliance Industries Ltd. and Nayara Energy Ltd. (formerly Essar Oil Ltd.) — are the primary buyers. Nayara bought about 70,000 barrels a day of Venezuela's oil in 2018, according to tanker tracking data compiled by Bloomberg. Reliance Industries is the biggest private refiner in India and also the country's top buyer of Venezuelan crude, at about 270,000 barrels a day, or roughly 80 percent of the total.
During a meeting between US Secretary of State Michael Pompeo and Indian Foreign Secretary Vijay Gokhale on 12 March in Washington, the former emphasised that India should avoid becoming the "economic lifeline" to the "authoritarian" government of Venezuelan President Nicolas Maduro by purchasing oil from the Latin American country.