India eyes military favors for Myanmar oil

It appears that India is not going to make it easy for China to extend its influence in Myanmar to get a share of that country’s rich gas resources. While recent oil negotiations have faltered between India and Myanmar, increased military cooperation might be New Delhi’s second-best option to obtain favor and influence in the secretive Southeast Asian country.

Amnesty International this week quoted “credible sources” saying New Delhi has plans to sell military helicopters to Myanmar that

will undermine a European Union arms embargo on the military-ruled country.
India’s proposed sale of the Advanced Light Helicopter (ALH) made by Hindustan Aeronautics Ltd, and which includes components from Britain, Germany, France, Sweden, Italy and Belgium, may harm the EU’s almost 20-year restriction on such sales, whether “directly or indirectly”, the London-based group said. However, India has denied Amnesty’s assertions, and a Foreign Ministry spokesman in New Delhi called them “completely baseless”.

But despite New Delhi’s denial of the Amnesty report, there is reason to believe that India will not take China’s influence in the area lying down. Indeed, official sources say there is a possibility that an India-Myanmar counterinsurgency-cooperation project could shift from independent tactics to joint operations on Myanmar’s territory. New Delhi believes that insurgent groups in India’s northeast derive support from Myanmar rebel groups.

Apart from terror strikes, Indian insurgents have been running kidnapping and extortion rackets in northeastern states such as Nagaland, Assam and Manipur. Recently, a kidnapped senior official of an oil company was killed in crossfire between the police and United Liberation Front of Asom militants in Assam.

Recently, India’s Ministry of External Affairs scolded the Petroleum Ministry and its Gas Authority of India Ltd (GAIL) for failing to secure the Myanmar government’s initial offer of gas from two offshore blocks where two Indian state-owned companies hold 30% equity. At a recent meeting called by the Prime Minister’s Office, Foreign Secretary Shiv Shankar Menon said the Oil Ministry and GAIL did not make “concerted efforts” and did not act on a letter of intent from Myanmar issued in February 2004.

Meanwhile, irked by the delays in implementing the Myanmar-Bangladesh-India pipeline and buoyed by China’s strategic support at international forums, Myanmar recently signed a memorandum of understanding with PetroChina to supply 6.5 trillion cubic feet (tcf) of gas from Block A of the Shwe gas fields in the Bay of Bengal for more than 30 years.

The decision came as a major blow to India’s bid to tap gas from its eastern front. Myanmar’s gas resources were estimated at 18tcf in 2005. Myanmar and China have also agreed on a project to build a pipeline to transfer oil to southern China.

GAIL has also been looking to exit from the A-1 and A-3 blocks in the Rakhine Offshore area over what it claims has been the “difficult” attitude of the Myanmar government toward India’s attempts to secure gas. India’s largest explorer, Oil and Natural Gas Corp (ONGC), also holds a stake.

Indeed, the thinking in New Delhi seems to be that India, beyond just the economics of buying gas, will have to extend strategic support to Myanmar to stand a chance to outwit China. Official Indian delegations have visited Yangon periodically to convey New Delhi’s concerns.

This is especially true in light of the government’s recent dramatic reduction in the estimated amount of domestic gas reserves that were initially announced with much fanfare.

Asia Times