News: Kazakh WTO card tantalises India

(DNA 14/10/2006) New Delhi - Differences between India and Kazakhstan became palpable at the end of the sixth joint commission meeting on Friday after the latter insisted on support for its case in World Trade Organisation as a quid pro quo to let India realise its oil needs.

“If and when Kazakhstan joins WTO, countries will be able to join Kazakhstan on market terms…Early inclusion of Kazakhstan in WTO will have an impact on participation of India in Satpayev block,” said Baktykozha Izmukhambetov, minister of energy and mineral resources, and head of Kazakh delegation.

Izmukhambetov saw no reason to hinder a bilateral agreement with India, but insisted that his country’s equation with ONGC Videsh LTd (OVL) depended to a large extent on the equation it has with world’s largest steel maker Mittal Steel.

Asked specifically if participation of Indian firms depended on partnership with the Mittals, the minister said, “Because of many years of its (Mittal Steel) operation, they are our senior participants. I wish ONGC, after five to seven years, will have the same status.”

Kazakhstan offered 50% stake in the oil block in Caspian Sea to the joint venture of ONGC and Mittal Steel, though to begin with it would want to give only 20-25% share. This proposal was not agreeable to OVL, which wanted a firm indication of 50% share before it started making investment. “It is a risky business and unless a firm indication is made it does not suit OVL to make the investment,” an Indian official said. Nothing has been formally offered on paper, he added.

A Mittal Steel executive said the two partners and Kazakh national oil firm, KazMunaiGaz, would be meeting in November in Kazakhstan to sort out details of the deal. The Kazakh minister was very categorical that nothing would come to India without going through the bidding route.

Petroleum minister Murli Deora’s meeting with a Congo delegation earlier in the day was more fruitful.The two sides decided to do the groundwork during Congo’s presidential visit next month to India. “They have a 1-million-tonne refinery that is working only 30% of its capacity. They want to upgrade it. They are also looking at collaboration in the railway and buses (urban transport) sector,” Deora told reporters.