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agarwal ambani

Mr Agarwal, founder of Vedanta and Mr Ambani, chairman of Reliance Industries

With the purchase of Cairn India, Mr Agarwal, boss of the mining powerhouse Vedanta resources, officially challenged the dominance of Reliance Industry, the Ambani’s giant in petrochemicals and refining[1][2]. Vedanta and Reliance were undisputed kings in their respective sectors: complementary and parallel. Both can count on mighty political clout and this feud showed their potential: in defence of Ambani’s Reliance went in Mr Sharma, chairman of the state-owned ONGC and Petroleum Secretary Mr Sundareshan. On the camp of Agarwal’s Vedanta, nobody less than UK’s Prime Minister David Cameron[3].

Mr Cameron pubblicly lobbied in favour of Vedanta with Mr Singh.

Mr Cameron pubblicly lobbied in favour of Vedanta with Mr Singh.

The bone of contention is simple: oil. In Sri Lanka[4]. Offshore of the Mannar Basin lie reserves up to a billion barrels. Reliance Industry was drilling on the Indian side of the Strait, but when the government of Sri Lanka offered the exploration rights in 2007, they Ambani’s group declined. Why?

Well there are always a lot of risks associated with oil extraction, first of all, there is no guarantee of discovery, second it could be not commercially viable to extract it.

But the Mannar Basin case was even riskier: it was the theatre of a civil war. The area was under the control of the LTTE, one the fiercest guerrilla army in the world. Surely if you buy, you want some guarantees that your will be able to access your property.

The LTTE navy, the Sea Tigers, guaranteed the security of sea lane supply for more than 30 years.

The LTTE navy, the Sea Tigers, guaranteed the security of sea lane supply for more than 30 years.

Now the company that was awarded the concession was Cairn, a small venture based in Edinburgh (with the bulk of their interests in India). What was the level of political leverage that Cairn could exercise to demand for assurance? Null. The management of Cairn, we are supposed to believe, bought the exploration rights with no further collateral for their purchase, no political promise that their property will be their hand soon.

But in 2011 Vedanta saved the “Scottish” company with their offer[5]. The operation was hardly contested by the Indian government; as we have seen, the move was an aggressive entrance in the landscape of Reliance and Ambani’s clan didn’t particularly welcome the new comer[6].

Agarwal acknowledged the leading role of Ambani: “They (Reliance) will continue to be the largest player. But, at the same time, there is enough water in the sea for other players to also do business.” [7]

If you are familiar with the Indian capitalism, you know very well that the big players are running monopolies supported by political protection. Competition is sacrilegious. So why Agarwal decided to challenge so directly Ambani?

Adivasis fighters.

Adivasis fighters.

Rumours go that he was concerned for his venture in Orissa[8]. Vedanta was involved in a billion mining project; they received of course all the authorization from the central government, but a small detail was blocking the operations: 80 million of Adivasis, the Indian Aborigines. The inconvenience was due to be quickly removed with mass evictions; this led the Adivasis to join the Maoist guerrilla, but Vedanta wasn’t worried: in fact the central government declared this insurgency (sometimes the Adivasis attacked with bows and arrows) as the nation’s main security threat: more than the archenemy, atomic-armed Pakistan. Operation Green Hunt was launched to eradicate the Maoist[9] and incidentally, any obstacle to Vedanta manoeuvres. Unfortunately for Vedanta, public and international outcry sprung in favour of Adivasis and suddenly the big deal, despite all the political support, was in peril[10]. The Orissa crisis urged Vedanta to look for alternative business[11]. Quickly.


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In this video, India’s express Chief Editor Shektar Gupta interviews Sri Lanka’s President Mahinda Rajapaksa for NDTV’s program “Walk the Talk” on 1st of June 2009, in the immediate aftermath of the end of the conflict.

The first, immediate aspect is about a sense of normality, almost familiarity. I don’t want to dig about the mutual propaganda of India and Sri Lanka, but one thing is clear: this interview could not take place with a Chinese journalist.

Colombo is leaning vigorously on the Beijing side and yet this meeting is a reminder that Sri Lanka plays with India, not matter how many billions, tankers or vetoes in the security council arrived from far away, ultimate solutions and persistent problems will concretize in the neighbourhoods.

On this line it is emblematic what Rajapaksa considered Prabhakaran’s biggest mistake: the killing of Rajiv Gandhi (part 1, min 02.20). More than the genuine thinking of the President it is important that he is completely in tune with an Indian audience. For Rajapaksa is not an effort to get in to such character: he’s more than pro-India or India-friendly: he is organic in the Indian vision of politics. This is obvious, regardless the sincerity of the president.

The triumph of this attitude of course is when Rajapaksa says: I was fighting their war (part 2, min 3.55). Probably there is the intention of favourably influence the Indian public, but he transmits also a degree of submission, almost like a servant delivering the job for his master. Many consider Rajapaksa a cunning fox, which is actually deceiving the Indian partner. But when discussing the timing of Prabhakaran’s killing it is more than obvious that it was prepared in collaboration with New Delhi: even Gupta, in his most than toothless interview, feels the need to highlight the timing (part 2, min 2.00). I want to point out few lines earlier: when discussing the politicians in Tamil Nadu, Rajapaksa doesn’t have the guts to mention their names (part 2, min 1.20). The nationalist Tamil parties are direct in their accusation and they clearly stand as a vocal opposition against his administration. Yet, he is quick in downplaying a straight confrontation.

This overdose of diplomacy sounds wrong, especially when with soft words claims that the Tamil issue is an invention of politicians (part 2, min 5.35). That is a sort of very dark sarcasm, if you consider the numerous progroms against the Tamil since independence. The horror grows in the final, when he assures that he’s looking after the Tamil brothers and sisters in Sri Lanka (part 3, min 5.15).

13 out of 16 division of the Sri Lankan army are stationed in the North and the East; countless cases of abuses against women by armed forces, land grabbing and expropriation. All these episodes are not good example of protection. But the pearl of this exaggeration is not contained in the screened version of the interview; if you go to on-line transcript[1]: he claims that the number of civilians is less than 100. Less than 100!

This would be ridicule if we weren’t talking of one of the most horrendous massacres in recent history. NDTV had the taste of not including these idiocies in their program; on the other hand Gupta certainly didn’t grill his interviewee. The overall impression is that India and Sri Lanka share more than cultural and economic ties: also responsibility for the slaughtering of tens of thousands of civilians, Tamils to be precise, and also for the mediatic cover up of the entire operation.

Well done India!

bidding oilOn the 7th of March 2013 Sri Lanka’s government held an international road show to facilitate the bidding process for the offshore exploration rights for several blocks[1], locations: Houston, London, Singapore.

It may be interesting to note two facts: in this round there is almost a unanimous interest: Exxon, Total, Eni, BP, Gazprom, Petronas[2].

This enthusiasm probably derives from the successful operations of Cairn-Vedanta. The Anglo-Indian company in 2011 found oil.

This leads to the second interesting fact: the previous road show was held in 2007[3], same locations (Houston, London, Singapore). Did anybody hear about the Eelam War? It ended quite bad for the LTTE, the separatist army, which was annihilated and also for more than 360 000 Tamil civilians, chased out like wild animals. More than 80 000 civilians are supposed to have died in the final stage of the conflict. Well, in 2007 the war had just re-started. Not a surprise that the bidders were a bit more cautious.

rajapaksa oil cairn agreementIn fact the LTTE was one of the best trained, motivated and fierce liberation army in the world, with an exceptional navy. During the civil war, the LTTE navy, the Sea Tigers have been able to evenly match the Sri Lankan one. The region controlled by the Tamil Tigers was run like a state, with banks and post offices. And it was rely heavenly on sea supply lane. So it was vital for the LTTE to have a successful protection from the sea. Then in 2007 India started patrolling. India’s position has been ambiguous, to say the least, with the LTTE.

But in 2007 the idea of buying exploration rights in war zone was simply mad. Unless the government pledged beyond any reasonable the certainty of the deal…

How can you guarantee such agreement during a conflict?

Probably you planned carefully to eliminate any resistance, any dissent. And with 1 billion barrels of oil, you can buy international support and help.

no war franceFrance became the global defender of peace and international justice when it antagonized the USA for the war in Iraq. Legions of citizens looked at Paris as the guardian of civilization: again the nation of liberte egalite fraternite stood against the brutal, warmongering forces which regularly try to strangle the universal values of citizenship and human rights. Very well, nice, lovely. Only, France didn’t oppose USA for those reasons; it is true that they considered the war in Iraq as unlawful: but the big problem was that they were excluded from the loot, not the war itself!

In fact France is not against colonial imperialism: it was one of the major colonial forces in the past; what France object is to be left behind in the race. In Iraq Paris could clearly see that the Iraqi oil was going all in American pipes. Mon Dieu! Never again!

france warSo when the Arab spring shook the region, France was more than ready to invade another country and to plug French pipe in the Libyan oil wells. The war in Mali signifies a new commitment of France in Africa. Mali’s undersoil is supposed to contain uranium, oil, gas and gold[1]; it is also a neighbour of Nigeria, which has an increasing agitated scenario by its own Islam groups[2]. Whatever the reason, France is on the move to re-assert its sphere of influence[3].

kouchner milibad

France and UK foreign ministers Kouchner and Miliband meet Sri Lanka’s President Rajapaksa.

So I have a rule of thumb: if you see a French diplomat on the move, ask yourself what business is in sight. During the last days of the Eelam War, we saw Kouchner and Miliband (respectively France and UK foreign ministers) running to make pressure on Colombo’s government. What kind of pressure? Well some photographic posing, speeches in favour of human rights and the rule of law. In brief, absolutely nothing. Now, Great Britain has very clear economic interests: they sell weapons to Sri Lanka and they are actively involved in the oil exploration in the Mannar Basin. Cairn and Vedanta are listed in London, though they are Indian companies. But France will remain seated while others are making money in the usual colonial way? Mon Dieu, impossible!

Parithi killing in Paris

LTTE member Parithi Killed in Paris, 2011

Last year a former LTTE leader (the secessionist Tamil movement, defeated in 2009 with the massacre of 80 000 civilians),  Nadaraja Matheetharan alias Parithi was killed in Paris by agents of the Sri Lankan secret services[4]. My big question was: how France can allow such a move on its soil? Especially after Sri Lanka should maintain quite a low profile with the international community and the West… What happened?

Well Cairn and Vedanta don’t hold an exclusive of exploration: they have concession for ONE zone. In the 2013 Sri Lanka will organize another round of auctions. Which are the front-runners? Exxon and Total[5]. I think we’ll hear a lot of noise in Geneva about committee and votes, and alignment, and new resolution and all this sort of empty talking. I suspect that the murder of Parithi was a “gesture of good will” from France in the perspective of the oil exploration rights bidding. totalHuman rights declaration is not worth the paper is written on if you don’t have the political will to enforce it. Mon Dieu, colonial times are over, can can’t interfere in internal matters, we only give wise, impotent advices. Of course the farcical clash of interest is merely superficial: the government of Sri Lanka can show its citizens and supporters that they stand against the old colonial power, the European countries can show their own citizens, they stand for the right cause, but diplomatic route will take time. And we have plenty of time, don’t we? History is not written in a day, oil contracts are. Anything else left to discuss in Geneva?

Adivasis revolutionary fighters

Adivasis revolutionary fighters

What is the biggest threat to India’s security? You could think of further terrorist operations orchestrated by their arch-enemy Pakistan, the so called containment strategy of China with the String of Pearls, but no, you would be wrong. Surely the Indian armed forces and the RAW, the secret service are taking into account these issues as future menaces. But the current, biggest threat to internal security is the Maoist guerilla of the Naxalites, which count amongst its file indigenous warriors armed with bows and arrows. Members of the Adivasis, the indigenous ethnicity of India, more than 80 millions, are fighting back against the oppression by the central government and joined the Maoist militia in several states. The some of the Adivasis are tired of being discriminated and most of all expropriated of their land rights.

Adivasis's rally

Adivasis’s rally

And New Delhi, the biggest democracy of the world, the strong ally of the good Western government amongst the dodgy, authoritarian Asian states, responded with a responsible, measured, contained military operations, called Green Hunt. In collaboration with the regular forces there are also paramilitary troupes, funded by private stakeholders. These are the best practices exported by the USA during the Afghanistan and Iraq wars and we should admire the consistency of India in aligning itself with the best Western policies.

Adivasis' protest against Vedanta

Adivasis’ protest against Vedanta

You may ask why the Indian government is so upset with indigenous populations, who lived for millennia in their forest, with unchanged habits and astonishingly sustainable behaviour, why they are fighting these groups rather than picking them up as global models? Easy to answer, it is the case that they live where there are enormous reserve of metals and minerals. And given the needs of the growing Indian economy and the worldwide prices, many companies are salivating at the idea of grabbing those mines. In particular the giant Vedanta secured vast concessions. And they want to exploit them, so they supported this massive campaign to evict the Adivasis from their property.

Sri Lanka Defence minister Gotabaya Rajapaksa, with alleged blood stains on his shirt.

Sri Lanka Defence minister Gotabaya Rajapaksa, with alleged blood stains on his shirt.

A generous offer of consulting about the matters arrived from Sri Lanka. Gotabaya Rajapaksa, brother of the president Mahinda and plenipotentiary minister of Defence, not to mention acclaimed leader of the army and potential war criminal for the massacres of 2009, offered his help1.

Mr Rajapaksa exposed his rationale: we have matured an extensive experience in counter-insurgency and we learned how to deal with fighters mingled with civilians. You have only to control the media and position yourself wisely in the international scenario, then you can do whatever you want. Seriously, you can slaughter hundreds of thousands (yes, around 3 times the victims in Sirya) of civilians and nobody will mind your business.

If you think that I’m exaggerating, many Indian commentators thoroughly studied the Rajapaksas’ strategy and compiled a brief guideline that is precisely mentioning control over the media, international relations and steel determination to achieve the goal, regardless of civilian casualties2.

Gen. Bikram-Singh visits Sri Lanka President Mahinda Rajapaksa.

Gen. Bikram-Singh visits Sri Lanka President Mahinda Rajapaksa.

Finally Rajapaksa can offer an already integrated plan of action: Sri Lankan and Indian forces not only conducted joint operations in the past. During the IV Eelam war, military officer from the Indian forces were actually on the field, monitoring, observing, advising and cooperating with the Sri Lanka’s Army. New Delhi is perfectly aware of what happened in 2009 and the fate of the so called “brethren” Tamil. Tamil Nadu politics is based on the support to the Tamils on the other side of the Strait. At least this is the main characteristic of one of the most important politician, Mr Karunanidhi, who was Chief Minister of Tamil Nadu during the final days of the war and who didn’t move a finger to safe his beloved bretheren because was involved in a massive scandal of corruption.

In a matter of days, India answered, that, yes, they are quite interested in the Sri Lankan offer to train them on counter-insurgency. Quoting Gen. Singh: “With significant experience on both sides, we have a lot to learn each other and we look forward to reinforcing our cooperation in the military domain further”3.

Sri Lanka granted exploration right to Cairn back in 2008

Sri Lanka granted exploration right to Cairn back in 2008

A final note: in the Mannar Basin, offshore from the coast controlled by the LTTE and scenario of the massive, brutal counter-offensive of the Sri Lankan army, in which almost 440 000 civilians have been chased like wild animals for months, it has been found oil.

And guess who is taking control of those oil field? You’ll never get it. It’s Vedanta again!

So Vedanta is conducting paramilitary operations in India to evict Adivasis, and then it turned to Sri Lanka to expropriate the Tamils because of the oil, using the ruthless Rajapaksa regime as (happy) executioner of the dirty job. If it was a Hollywood movie, you had say that the figure of the evil company exploiting natural resources and killing poor indigenous would have been too clichè to be true. As usual reality is more surprising than fiction, much more.

290 000 Tamil civilians come out from the last siege of the Sri Lankan army.

290 000 Tamil civilians come out from the last siege of the Sri Lankan army.

Advance: A line of British soldiers in camouflage during the Falklands WarPhoto mirror.co.uk

Advance: A line of British soldiers in camouflage during the Falklands War
Photo mirror.co.uk

The Falklands war was not oil-driven. In the first place, it was started by a military dictatoriship in Argentina to distract public attention. Second, the UK response was equally motivated to captivate the electorate and to twist public sympathy towards the Tory. It was risky? Probably yes, but it paid wonderfully well for Margareth Tatcher.

These were the driving forces in 1982 to catalyse an armed conflict. And yet everybody at the time knew that around the Falklands it was plenty of oil. How much? Well, these are always estimates, but it seems that the reserve could amount to 60 billions (almost a quarter of Saudi Arabia reserves. Not bad) but probably only 3.5 are commercially recoverable1. Since the 1994 Argentina and UK have been in negotiations to settle the matter after the conflict. But Buenos Aires walked away and from 1998 British companies have started to try their luck2.

Falkland Oil & Gas shares halved after an update on operations around the Falkland Islands. Photograph: Gary Clement/Reuters

Falkland Oil & Gas shares halved after an update on operations around the Falkland Islands. Photograph: Gary Clement/Reuters

Nowadays oil exploration is at an advanced stage in some platform and production in at least on well (Rockhoppen Sea Lion, almost 1,3 billion barrels, expects to start its first shipment by 20173).

The question is: did the Brits have a good idea about oil presence in the Falklands? The answer is a sound and round yes. The first time the British government knew about oil in the Falklands was in the remote 1969. At the time Richard Crossman, member of the cabinet, wrote in his diaries that the Foreign Office wanted to conceal the thing and prevent any further testing4. The Foreing Office feared of a possible aggravation of the territorial dispute with Argentina. Why? In public the British government was confident and bold about legitimacy of its claim. In private not so much. In 1936 John Troutbeck, head of Foreign Office American Department summarized difficulty of Britain’s position:

“Our seizure of the Falkland Islands in 1833 was so arbitrary a procedure as judged by the ideology of the present day. It is therefore not easy to explain our possession without showing ourselves up as international bandits.”5falkland capture

By 1975 almost 50 companies had applied to Britain for exploration rights. So when in 1982 Gen. Gualtieri invaded the islands, London proclaimed to intervene to safeguard the independence of the Falkland inhabitants and give them freedom of choice. Beside the fact that after the seizure in 1833 they evicted all the Argentinian citizens, so in the Falklands were living only British descendants, few years earlier, they had no problem in forcing the evacuation (against their will) of the inhabitants of the Diego Garcia, an island in Indian Ocean. Moreover all the inhabitants of the Falkland are working for a private company, which is basically the sole employer and land owner of the island: the Falklands are basically private property6.

 The war is still remember as a tremendous success for the British army and it represented a turning point for the electoral success of a Tory party that was depressing an entire generation of workers. 30 years later those military operations proved to be also a good investment. And it didn’t happen accidentally.

Cairn Lanka is commencing seismic acquisition in Mannar Basin with an investment of over US $ 100 million. President Mahinda Rajapaksa flagged off the first ever 3D Seismic activities in the Mannar Block from the Colombo Port recently. Photo dailynews.lk

Cairn Lanka is commencing seismic acquisition in Mannar Basin with an investment of over US $ 100 million. President Mahinda Rajapaksa flagged off the first ever 3D Seismic activities in the Mannar Block from the Colombo Port recently.
Photo dailynews.lk

Now, 1 billion of barrels are lying in the Mannar Basin, with commercial production expected by 20147).

Exploration rights were sold before the end of the war and when the block was still in an area under the control of the LTTE. The company, Indian Cairn, listed in the UK, has been sold to another Indian corporation, the giant Vedanta, listed in the UK as well.On its side of the Strait India has oil operations (it was even speculated that it could stolen from the Sri Lankan reserve).

Are we still asking why India helped Sri Lanka in slaughtering 70 000 Tamils? Or why the UK remained silent and recently invited president Rajapaksa for the Diamond Jubilee?

Nothing new under the sun, nothing.

Sri Lankan Tamil regugees (IDP) from the Mannar region.Photo AP

Sri Lankan Tamil regugees (IDP) from the Mannar region.
Photo AP

China's President Hu Jintao and Governor of Malacca Khalil Yakub

China’s President Hu Jintao and Governor of Malacca Khalil Yakub
Photo Reuters

President Hu Jintao back in 2003 started to mention the so called “Malacca Dilemma”, the fact that 80% of China energy needs will pass thorugh the waters of Malacca, without having any strategic influence over it1.

The Chinese leadership is quite aware that whoever will control the Strait will be able to choke the supply line of the People’s Republic. It is interesting to note that the notion of the Malacca Dilemma and the String of Pearls were born almost at the same time. The String of Pearls is much more famous, but is also more misleading. It aims to address the containment policy of China against India. If you reflect, China will never be able to evict India from the Indian Ocean. Moreover China is already a global superpower, while India is struggling to become a regional one. The only field in which they are competing directly is natural resources. But the String of Pearls won’t deny that to India. The truth is that the String of Pearls is a menace perceived by the US. Washington really could be excluded from the South East. So the Americans are pushing the Indians to think they are threatened by the Chinese.

In this puzzle, the role of a piece is growing in importance: Myanmar. Back in 2007, president Bush put its eyes on the humanitarian condition of Burmese people2. It is praiseworthy, especially from an administration that launched wars to appropriate natural resources of sovereign state, practised unlawful detentions, torture, extrajudiciary killings and so on. Myanmar is itself rich in natural resources and lies in a strategic position: just before the Malacca Strait. Much of the attention Myanmar received in recent years should be probably ascribed to this aspect, rather than the restless endeavour of the US for human rights.

Sri Lanka's President Rajapaksa and India's Prime Minister Singh

Sri Lanka’s President Rajapaksa and India’s Prime Minister Singh

The Tamil diaspora in Malaysia

Finally, with regards to Sri Lanka, it should be clear that there is no such a thing as India strangled by China. Beijing is securing its supply lane; Sri Lanka is part of this architecture. Nobody in New Delhi has been forced to do anything. What happened to the Tamils and the LTTE has nothing to do with the clash of global super powers. Sri Lankan deeds are a domestic affair for India and they have been treated as such. It is easier to blame the Chinese and because they consider this kind of debate as farcical, they don’t even defend themselves. But an accurate analysis of the geopolitical interests will show that Sri Lanka is under the patronage of India, with occasional and contingent flirtations with China, dictated by convenience rather than long term alliances.

The Malacca Strait is the place where the future rearrangement of the global balance of power will take place. India should start to look at its interest, rather than following the clue thrown by the Americans (though sometimes they could overlap in any case). And if the Tamil diaspora in Malaysia has any intention to influence the international scenario, should start to appreciate its strategic role in this context, rather than chasing the infinite intrigues of New Delhi politics.

1Chen Shaofeng, “China’s Self-Extrication from the “Malacca Dilemma” and Implications” International Journal of China Studies China’s Vol. 1, No. 1, January 2010, pp. 1-24