India’s exit from troubled waters, submission or an attempt at nurturing strained relations?
May 24, 2012

ONGC Videsh(OVL) has decided to back out from Block 128 in the South China Sea. This move has widely been regarded as a wise one, with most experts agreeing that the ties between India and China now stand to greatly benefit. As Inchin Closer mentioned previously, China has always maintained that the entire South China Sea inherently belongs to China. The end of India’s oil dealing shoal with Vietnam- claimed territory in the sea, we believe, has the potential to reduce tensions between India and China, forever wary of treading on the other’s feet.

Meanwhile, four Indian Navy ships, INS Rana, Shakti, Shivalik and Kurmak are at this moment sailing for Shanghai across the South China Sea. Despite having withdrawn from the oil exploration blocks in the South China Sea, India prefers to make its presence felt.

If India does not even stand to gain oil in the South China Sea, why the persistence in staying on? The prevailing view is that India’s Look East Policy is a key factor which determines its interest in the South China Sea.

Several also believe that the reason for OVL’s decision was influenced by the pressure of the Chinese government. Brushing off such speculation, Fu Xiaoqiang, an expert on South Asian issues at the China Institutes of Contemporary International Relations, in an interview in the Global Times, “China has always held a firm stance on the South China Sea issue, so it can hardly be said that India is under pressure from the Chinese government this time despite the fact that India will take the China factor into account considering its global and regional presence.”

Said Skikanth Kondapalli, chairman of the Center for East Asian Studies with Jawaharlal Nehru University, in the same interview, “I think the Indian government’s decision is a result of commercial reasons. It was suggested that these blocks are not commercially viable. Hence the decision to exit.”

Whether India’s decision was taken due to the lack of oil in the reserves or because it was another move to appease its neighbour is now a question of which camp you come from.


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