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India courts Saddam : Significance of wheat-for-oil deal |
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Shedding its decade-long coyness, New Delhi has taken the first step to revive its old friend ship with Iraq, in spite of its still being under UN sanctions. By signing a counter trade deal providing for sale of wheat to Iraq in return for oil during last week's visit of Iraqi Vice President, Mr. Taha Yassin Ramadhan, India has opened a new chapter in Indo-Iraqi relationship. Although the quantity of oil and wheat to be sold to each other is yet to be negotiated, trade sources indicate that India could contract for an additional million tonnes of Iraqi crude and sell wheat over and above the November orders for 350,000 tonnes. Assuming the commercial terms are in fact right, the arrangement makes good sense for India at several levels while Baghdad makes major diplomatic gains. India needs to reduce its food mountain as lucratively as possible. The Food Corporation of India is sitting on 26.5 million tonnes of wheat and finding it hard to unload. What could be better than to trade excess wheat stocks for oil.
Baghdad has signed counter trade tie-ups with a number of countries, notably China and Russia outside the purview of the America dominated UN sanctions committee. In all probability, New Delhi will follow the same route, although the Indian Foreign Ministry spokesman has made it clear that India will seek the clearance of the sanctions committee.
Political observers feel, the deal with Iraq has both political and economic advantages. On the political side, the Vajpayee Government has been facing t1ak for its pro-Israeli tilt. Any deal with President Saddam Hussein government is an opportunity to send the right signal to a domestic vote back the BJP is after since the Nagpur session. There is an added urgency too on another score. Pakistan is trying to exploit the Indo-Israeli equation to its advantage. At the recent OIL meeting in Doha it almost succeeded in its mission to have India condemned for forging friendship with Israel whose soldiers are butchering the Palestinians in the current wave of unrest.
The deal ret1ects a pro-active approach to international relations. Instead of waiting for the sanctions against Iraq to be lifted, India has chosen to first reach an agreement and then sell it to the UN sanctions committee. This process will int1uence the position India adopts towards the larger issue of lifting sanctions against Iraq. The resultant closer integration of the country's international economic and political strategies is another reason to cheer the deal.
The deal could be the forerunner of a carefully calibrated programme to rebuild commercial ties with Iraq. The long-term benefits are very promising. India has been one of the closest allies of Iraq and contributed mightily to its industrial and social development before the war. That was also the preferred destination of Indian workers thanks to liberal laws and a relaxed attitude towards foreigners. Even today, Iraq owes money to Indian construction companies. India's experience and warm friendship should lead to lucrative business deals once the curse of sanctions gods away. In fact, the visiting Iraqi leader, Ramadhan said, his country will remember those allies who stood by it during its trying days. And offered a big slice of the contracts in the post-sanctions period.
A simultaneous meeting of the Indo-Iraq Joint Commission in New Delhi is equally significant. The bunching of the two and the incessant talk of an early end to embargo and India's gamble in openly talking about a crude for wheat swap deal is as oblique an indication as any that the USA and Britain are finding it difficult to stick to their stand that has wreaked death and destruction across the country.
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