It’s just the oil, honey

The decision of the Organisation of the Petroleum Exporting Countries (OPEC) to extend oil supply cuts at the recently concluded meeting may have important implications for both oil producers and more importantly oil consumers, like India. Collectively, OPEC and its allies (together known as the OPEC+) would curb production by 1.2 million barrels per day (mb/day) for nine months until March 31.
 
Context
 
Global commodity prices saw a dip after the global financial crisis. This occurrence was counter-intuitive due to a kind of hysteresis and slowdown in demand and thus, the resulting price drop happened much later. However, the prices peaked in 2012 when the OPEC average crude oil price touched a high of almost $110. But then prices began to plummet- as low as $40 in 2016.
 
Now, the OPEC+ alliance has been reducing oil supply since 2017, to prevent prices from sliding and has opted to extend the cuts repeatedly since then. Credence to this statement includes the shale oil boom, which requires less upfront investment to push up oil supply. Also, the economic reprieve provided for Iran, one of the core founders of OPEC, ramped up the production, followed by differences propping up among members who failed to reach an agreement that consequently resulted in oversupply. These were the reasons that have caused oil prices to remain at rock-bottom.
 
So, the recent decision to curb supply is poised to restore demand. But, amidst signs that the global economic slowdown may hit the oil demand growth, OPEC and allies might face an uphill task to shore up prices by reining in supply.
 
How does this play out for India?
 
These extensions of production cuts come against the backdrop of supplies from Iran and Venezuela drying up from India’s energy baskets. The US sanctions on Iran and Venezuela in conjunction with the extra cuts made by Saudi Arabia have taken more oil off the market than the rest of the 11 countries involved in the production cut agreement combined. With tensions escalating in the Persian Gulf, India, the world’s third largest oil importer has been trying to impress upon the Saudi Arabia-led cartel, its own concerns on volatility in crude prices and its impact on India consumers.
 
Though the United States on its part has promised India of adequate crude oil supplies as was mentioned by US Secretary of State Mike Pompeo during his visit to India, but it is not so much about the sourcing rather than the price at which it is bought, which will impact the Indian economy.
 
What India needs now is a carefully driven strategy that is not myopic in nature, but instead, aims to gradually insulate the country from global oil price volatility. Such a strategy should be centered on three things: expediting migration to electric mobility, expanding the blending of biofuel in petrol and stimulating exports.
 
In this case, the much needed impetus to push electric mobility during the 2019 budget is a well-concerted move. Reducing the country’s reliance on oil imports would bode well for energy security and make the Indian financial markets less volatile in the event of untoward development of the oil market. Also, savings from reduced oil imports could in turn be used to finance the infrastructure projects which are crucial for India’s long-term growth prospect.
 
India Outbound
July 23, 2019

 
 

source https://indiaoutbound.org/its-just-the-oil-honey/

Indian-Russian ties amidst changing Eurasian dynamics

A new breakthrough happened in the Indo-Russian relationship on the sidelines of the 2019 G20 summit. On this note, the proposal by the Indian government to move forward with the S-400 defense system, whose payment would apparently be made in euros to a Russian nominated bank speaks heaps about the eminence that India attaches towards the relationship. However, for a partnership to become robust it needs to be supported by strong geo-political and geo-economic foundations that will provide it with much needed sustenance.
 
Apropos, during the Bishkek summit, PM Modi’s bilateral with his Russian counterpart outlays the significance of Russia in India’s foreign policy. This was visible through remarks of Vijay Gokhale, the foreign secretary, who emphasized upon Russia’s participation in India’s Act East policy, where India is looking to expand collaboration in Russia’s Far East.
 
Further, PM Modi’s acceptance of Vladimir Putin’s invite to be the Chief Guest for the Eastern Economic Forum to be held in Vladivostok early September also outlines the strategic importance accorded to this partnership, as the two leaders decide to further widen the scope of their economic partnership, in sectors such as energy, Arctic region, transfer of technology among others.
 
A defining aspect of the Indo-Russian partnership,post the Cold War days includes the military-technical cooperation between the two countries that have gone up tremendously and is probably at its most dynamic stage.With the induction of Russia into India’s Act East policy, where both Russia and India prepare to explore areas for enhancing India’s presence in Russia’s Far East, spell both economic and strategic imperatives for India, given the uncertainty in the international affairs.
 
So far, there is trade imbalance in favour of Russia, a marked departure from the past when the erstwhile Soviet Union was among India’s leading trade partners. More so, according to statistics, India-Russia trade during 2015-16 amounted to a dismal $6.7 billion, thereby highlighting the fact that trade and investment ties remain far below potential. In this sense, the above initiatives reflect some semblance of hope of reigniting the aspect of economic cooperation between the countries that has so far remained dormant.
 
So where exactly do the India-Russia relations stand now? The relationship in fact is quite a good metaphor for the polycentric world of offsetting ties of cooperation and competition as the sun sets in the turn on US unipolar dominance. Russia‘s pivot to Asia (read: China) started in 2014, following the US and the European Union, imposing sanctions to isolate Moscow after its annexation of Crimea. Further, Chinese premier Xi Jinping’s visit to Moscow, underscoring the strengthening of the Beijing-Moscow axis, compounded with Moscow’s outreach to Pakistan has definitely triggered concerns in New Delhi.
 
Thus, in a world that is increasingly grappling with the challenges of the bipolar emergence of power (US and China), India and Russia share a convergence of interests. In times such as this, where Trump is interested in pushing towards a “deglobalisation wave” while China is promoting “globalisation2.0.”,it makes sense for India and Russia to strengthen collaboration in all forms to hedge any disruptive forces.
 
India Outbound
July 4, 2019

 
 

source https://indiaoutbound.org/indian-russian-ties-amidst-changing-eurasian-dynamics/

Premier launch of CHRI’s ESTD report in India

The Human Rights Council (HRC) is a supranational organ of the United Nations (UN), which focuses on the “promotion and protection of Human Rights around the globe.” The HRC serves as a useful platform for countries and voluntary associations, such as the Commonwealth, to engage in meaningful dialogue with regard to human rights around the world. In order to facilitate such dialogue, it is important to educate stakeholders about the UN, its mechanisms and the various pledges and obligations that countries have voluntarily committed to, so that they are aware of the standard to which their performance should be pegged.
 
Enter, the Easier Said Than Done (ESTD) report.
 
Since 2007, the ESTD report has been produced by the Commonwealth Human Rights Initiative (CHRI) to evaluate the performance of Commonwealth member states at the Human Rights Council (HRC), and to highlight the opportunity for the Commonwealth and its member states to re-elect on and improve their human rights record. This year’s report, the 11th edition, was prepared by CHRI’s International Advocacy and Programming (IAP) department of CHRI, led by research officers, Aditi Patil and Sarthak Roy, and their team: Chinmay Panigrahi, Catia Trevasani and Aditya Bhattacharya.
 
For the first time since its inception, the ESTD report was launched in New Delhi, India at the OP Jindal Auditorium on 21 June 2019. This report covered the 40th session of the HRC and analysed the performance of 11 Commonwealth countries elected to the council:Australia,Bangladesh,Cameroon,India,Nigeria,Fiji,Pakistan,Rwanda, South Africa,the Bahamas,and the United Kingdom.
 
Aside from the launch of the report, the event featured presentations from the authors of the report, as well as panel discussions on the key findings, and India’s presence at the HRC. The 40th session saw the introduction of Fiji at the HRC, marking the first election of a Pacific Island country to the council. Commenting on the milestone, H.E Yogesh Punja, High Commissioner of Fiji, noted that reports such as the ESTD were fundamental for enabling effective and objective dialogues between countries to further the protection of human rights.
 
Several other eminent diplomats, senior government officials, activists and human rights defenders also attended the event, such as: Mr. Muchkund Dubey, former Ambassador and former Indian Foreign Secretary; Ms. Yukiko Koyama, Senior Protection Officer, UNHCR India; Mr. Jawad Ali, Counsellor, High Commission of Pakistan to India; Mr. Micyo Rutishisha, Second Counsellor, Rwandan High Commission, Ms. Pallavi Nayek, Direct Aid Program Administrator with the Australian High Commission, and Ms. Friederike Tschampa, a representative from the European Union.
 
When the topic of the discussion shifted to India’s human rights conditions, there were lively contributions from the distinguished panellists, each of whom reiterated the universality and indivisibility of human rights.
 
Mr Paul Divakar, General Secretary, National Campaign of Dalit Human Rights (NCDHR), said that inter-generational labelling had to be addressed at the grass-roots. Discussing the nature of identity politics and its role in rising divisiveness in the country, Mr Divakar added that there was no place for discrimination based on caste, gender or sexuality, in a meritocratic society.
 
Mr. TCA Rangachari (IFS, retired), former Amabassador to Algeria, France, Germany and India’s Permanent Mission to the UN New York, raised some concerns about India’s economic ability to follow through on its commitments at the international standard.
 
With the successful launch of the ESTD report at the 40th session of the HRC, and with the 41st session already underway, CHRI hopes that such reports will not only raise awareness among Commonwealth nations, but also spur the formulation of effective measures for the protection of human rights, at both the state and international levels.
 
Aditya Bhattacharya
July 3, 2019

 

source https://indiaoutbound.org/premier-launch-of-chris-estd-report-in-india/