- Venezuela’s Oil Reserves: Venezuela’s vast oil reserves, constituting 73% of Latin America’s energy reserves, present a lucrative market for India to meet its energy needs.
- Political Crisis: The political situation in Venezuela intensified in January 2019 when Juan Guaidó declared himself interim president, challenging Nicolás Maduro’s presidency, which led to international recognition and support for Guaidó from countries like the U.S. and European nations.
- U.S. Intervention: The U.S. practices the Monroe Doctrine, viewing interference in the Americas as a threat to its security, and has historically supported regimes with poor human rights records for its geopolitical interests.
- India’s Strategic Balance: India must navigate its relationship with Venezuela for energy needs while maintaining a strategic partnership with the U.S., despite the complexities of U.S. foreign policy and its historical interventions.
The Monroe Doctrine and American Influence: Consequences for India-Venezuela Relations
The crisis in Venezuela is a complex and ongoing situation characterized by political, economic, and humanitarian challenges. The current political situation has significant implications for India, as Venezuela’s oil reserves are the largest in the world, constituting 73% of all of Latin America’s energy reserves, making it a very lucrative market for India to fulfil its energy needs.
The political crisis intensified in January 2019 when Juan Guaidó, the leader of the National Assembly, declared himself interim president, challenging Nicolás Maduro’s presidency. Many countries, including the United States and several Latin American and European nations, recognized Guaidó as the legitimate leader. However, Maduro retained control with the support of the military and countries like Russia, China, and Iran. This action did not sit well with the U.S., which still practices the Monroe Doctrine, asserting that the New World and the Old World should remain distinctly separate spheres of influence and viewing any interference as a threat to U.S. security.
It is not up for debate that Maduro’s government has undermined democratic institutions, suppressed opposition, and committed human rights abuses, which the U.S. calls gross violations of human rights. However, looking at history, the U.S. has supported regimes that have committed mass murder, used force on opposition leaders, cracked down on protests, and even committed election fraud to ensure their candidate is victorious. Why should India be any different? In South America, the U.S. supported General Augusto Pinochet, who permitted torture, repression, and the killing of nearly 28,000 people. This is just one of many examples of U.S. interference in South America.
Already, the U.S. is upset with India for getting oil from Russia, which is later processed and sold to European countries. The relationship between India, Venezuela, and the United States regarding oil is shaped by geopolitical interests, economic considerations, and international diplomacy.
India’s Strategic Oil Partnership with Venezuela Amidst Complex U.S. Relations
India has been one of Venezuela’s largest oil customers, importing crude oil to meet its energy needs. Indian refineries are equipped to process Venezuela’s heavy crude oil, making it an important part of India’s energy mix and giving India leverage in geopolitics related to energy. India seeks to diversify its oil import sources to ensure energy security. Purchasing oil from Venezuela provides an opportunity for India to access cheaper crude, especially when U.S. sanctions limit Venezuela’s market options and potentially lower prices.
India must balance its relationship with Venezuela and its strategic partnership with the United States. However, in the last two years, it has been very difficult to ascertain which side of the bed the U.S. is getting off. The best example is the delay in supplying F414-GE-INS6 engines to power the HAL Tejas Mark 2 of the Indian Air Force (IAF).
The relationship between India and the U.S. is very paradoxical. On one hand, U.S. Senator Marco Rubio introduced a bill in Congress proposing that India be treated the same as Japan, Israel, Korea, and NATO allies when it comes to the transfer of technology. However, the current Biden administration is stuck in social intersectionality and woke policies that have led to interference in India’s internal politics.
The U.S. still hasn’t come to terms with the fact that India will never compromise its independent foreign policy. India benefits from Venezuelan oil while maintaining a strong relationship with the U.S., which is a crucial partner in trade, technology, and defence. India also buys weapons from Russia.
India is in a very unique position, as its GDP projections are positive, and it has the money to buy state-of-the-art weapons platforms, which the U.S. badly wants to sell. According to the Asian Development Bank (ADB), India’s GDP is expected to grow by 6.4% in fiscal year 2023 and increase to 6.7% in fiscal year 2024. The International Monetary Fund (IMF) has also raised its forecast for India’s GDP growth to 7% for the fiscal year 2024, reflecting strong performance in the services sector and increased investment demand (PwC) (Devdiscourse). Despite global economic challenges, India’s economy remains one of the fastest-growing among major economies, with sectors such as mining, construction, and manufacturing contributing significantly to its expansion (PwC).
United States Sanctions
The U.S.’s insistence on how India fulfils its energy needs is a cause of concern. The U.S. also has an interest in stabilizing global oil markets. While sanctions on Venezuela impact supply, the U.S. seeks to manage these disruptions through alliances with other oil-producing nations like Saudi Arabia and by increasing its own oil production.
With U.S. sanctions limiting Venezuela’s access to markets, countries like China and India have become more prominent buyers of Venezuelan oil. This shift affects global oil trade dynamics and prices. When it comes to monitoring changes in the energy sector, no one comes close to the U.S. It closely monitors everything, but post-Russia-Ukraine conflict, the U.S. has gone into overdrive to monitor India’s oil purchases from Venezuela, balancing its geopolitical strategy with the broader context of its bilateral relationship with India. While the U.S. has expressed concerns over these transactions, it generally avoids direct conflict with India on this issue. However, it uses its hegemony in cutting-edge technology, which India badly seeks.
In geopolitics, energy and defence go hand in hand. If India can maintain its supply of oil from Venezuela, it can pose a direct geopolitical threat to the U.S. to warn them not to interfere in India’s internal affairs. Venezuela is seeking to circumvent U.S. sanctions by diversifying its customer base and engaging in barter deals and oil-for-goods agreements with countries willing to bypass traditional payment systems.
India is now in a very advantageous position, as it can refine both heavy and light crude oil. India’s refining industry is one of the largest in the world and is well-equipped to handle various grades of crude oil, including heavy and light crude. Many Indian refineries have invested in advanced technologies and complex refining processes, such as coking and hydrocracking, which enable them to process heavy crude into valuable products like gasoline, diesel, and jet fuel. By having the capacity to refine both heavy and light crude, India enhances its energy security and reduces its dependence on any single source of oil. This flexibility allows India to respond to fluctuations in the global oil market and geopolitical developments.
In summary, the interplay between India, Venezuela, and the United States involves complex economic and geopolitical considerations. While India benefits from importing Venezuelan oil, it must navigate its relationship with the U.S. and the implications of international sanctions on Venezuela.
(The author is a freelance writer and has published articles on defence and strategic affairs and book reviews. He tweets @LaxmanShriram78. The opinion expressed is the author’s own)
Parag Gilada 
Rohan Kumar V