During his first visit to Guyana from 21-23 April, Indian External Affairs Minister (EAM) S. Jaishankar sought to push for energy cooperation with the South American country, which has recently discovered oil reserves and witnessed a resultant surge in energy exports.
On Energy Cooperation
During his weekend trip, Jaishankar organised a Joint Commission Meeting with Guyanese Foreign Minister Hugh Hilton Todd. He also launched discussions with several other Guyanese ministers.
While addressing the India-Guyana Business Round Table discussions, the EAM said that energy exports from Guyana would comprise a significant portion of prospective trade between the two countries.
Jaishankar’s comments come against the backdrop of Guyanese Vice President Bharrat Jagdeo’s visit to India in February, where he signed an MoU to bolster cooperation in the oil and gas sector.
India has been further looking to deploy skilled workers to Guyana and utilise the sudden boost in its oil sector in multiple ways.
3⃣. India reaches out to world's newest oil superpower
— Shashank Mattoo 🇮🇳 (@MattooShashank) April 23, 2023
EAM Jaishankar is in Guyana, his first visit there as Foreign Minister
Guyana, with population of just 800,000, is world's newest oil superpower
Since 2015, massive oil reserves have been found
However, Jagdeo clarified on Thursday that it rejected India’s request for discounted oil prices. He said, “Any sale of our crude will have to be on commercial terms, not a discounted terms (sic).”
While India and Guyana have been attempting to finalise an energy deal for two years, they have yet to reach a conclusion.
However, according to an Indian official source quoted by Reuters, given the distance between the countries, the crude oil does not make sense without a discount. They said, “Instead of paying a high freight for their oil, we will prefer to buy oil from the Middle East and East and West Africa.”
These developments come as India is looking to diversify its energy sources after the Ukraine conflict disrupted the global markets. To this end, it has been turning to other countries like Brazil and Colombia, with whom it recently signed deals for oil exports.
India’s interest in sourcing energy from Guyana comes as the country has discovered significant oil reserves since 2015.
In fact, two oil wells were discovered offshore Guyana in October 2022. This has attracted the interest of international energy companies and other countries seeking to secure oil imports.
India and Guyana, a traditional partnership that is being refashioned for contemporary times.
— Dr. S. Jaishankar (@DrSJaishankar) April 24, 2023
A few thoughts on my visit. pic.twitter.com/mFBuDmzpgP
According to ExxonMobil, a major international energy company, the country has around 11 billion barrels of oil reserves. To this end, Georgetown aims to pump around one million barrels a day in less than five years to become a major offshore oil exporter.
Promoting India-Guyana Trade Ties
At the Round Table event, Jaishankar also lauded the meeting as a historic discussion between “the fastest growing economy in the world, Guyana, and the fastest growing major economy in the world, India.”
The EAM said that the cooperation between the two countries was assisted by two events — Guyanese President Irfan Ali and Vice President Bharrat Jagdeo’s visits to India. He said these meetings transformed trade ties between the two countries from a “business-like relation” by infusing a “great sense of energy.”
In Guyana, cricket is never far away.
— Dr. S. Jaishankar (@DrSJaishankar) April 23, 2023
Good to meet Ramnaresh Sarwan and Steven Jacobs at the India-Guyana Business Round Table. pic.twitter.com/kP288KwObc
Jaishankar mentioned that following President Ali’s India visit, he sent a proposal to PM Narendra Modi delineating the “focus areas” of bilateral trade.
Although the Indian minister recognised that geographic distance has been a significant impediment historically, he emphasised the political closeness between the two democracies, underscoring their capacity to grow their economic proximity as market economies.
Accordingly, Jaishankar declared, “As [Guyana] embarks on this very exciting journey...on its quest for prosperity and development; there is a possibility, there is obviously a very strong interest on India’s part to be a partner in this journey.”
Apart from energy, the EAM outlined the importance of trade in health, pharmaceuticals, development partnership, and capacity building.