PM scores key wins in Oman, UAE

PM scores key wins in Oman, UAE

PM scores key wins in Oman, UAE

Agreements signed during Prime Minister Narendra Modi's recent visits to the United Arab Emirates (UAE) and Oman can be expected to boost India's energy and maritime security. India clinched a valuable deal with the Emiratis; an ONGC Videsh-led consortium of Indian companies has bought a 10% stake in Abu Dhabi's offshore Lower Zakum Concession. This entitles India to about 40,000 barrels of oil per day. In addition, India has sealed a deal which allows the Abu Dhabi National Oil Company to store six million litres of crude oil at Padur, near Udupi. In return, India will get first rights to the stored oil in the event of a disruption in supplies due to geopolitical conflict or a natural disaster. Having access to such a strategic reserve will go a long way in enhancing India's energy security.

In Muscat, Prime Minister Modi and the Sultan of Oman, Qaboos bin Said, signed an agreement that provides Indian naval vessels with access to the strategically located Duqm port and dry dock. Situated on the Arabian Sea, Duqm port is close to the Gulf of Oman, through which a significant part of India's oil imports pass. Hence Duqm's main value to India lies in its proximity to important sea lanes. A naval presence at Duqm will strengthen India's capacity to monitor and police these sea lanes. Additionally, Duqm port is not too far from the Pakistani port of Gwadar, which is one of the 'pearls' in China's 'string of pearls' strategy in the Indian Ocean. Recently, China opened a military and naval base in Djibouti as well. With China's presence in the Indian Ocean growing, the deal on Indian naval access to Duqm port, together with the recent agreement with Seychelles to develop a base there, have not come a moment too soon.

Oman's granting of naval access to India at Duqm, however, is not a sign of an emerging India-Oman front against China. Such an interpretation is flawed. Oman has strong ties with Beijing. Sino-Omani trade touched $23 billion in 2013 while India's trade with Oman is worth just $4 billion. India may have naval access to Duqm port, but the Chinese are developing a $10.7-billion industrial city nearby.  Oman is also keen to participate in China's Belt and Road Initiative. Thus, it is unlikely to be drawn into India-China squabbles. Therefore, India should strengthen ties with Oman not so much to counter China as to draw on its immense potential. Oil-rich Oman is home to a large Indian expatriate population. Importantly, unlike other West Asian countries, Oman - like India - is not hostile to Iran, which makes Delhi's engagement of Oman easy.    

 

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