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China,India and the Libyan oil

China,India are under some compulsion to deepen ties with the rebels who might become Libya’s new rulers.

As the four decade old Libyan autocracy led by Muammar Gaddafi began to dissolve rapidly over the weekend,China is adapting quickly. With India in the middle of a long weekend and its political focus riveted on Anna Hazare,Delhi might take a little longer in responding to the unfolding revolution in Libya.

On Monday,amidst reports of rebels gaining significant control over the Libyan capital Tripoli,a spokesman of the Chinese Foreign Office said,“The Chinese side respects the choice of the Libyan people.”

In a brief statement posted on the ministry’s website,spokesman Ma Zhaoxu said the “The Chinese side is willing to work with the international community to play a positive role in the reconstruction process of Libya in the future.”

Since the crisis in Libya began nearly six months ago,China has struggled to reconcile its growing economic interests in Libya and the pressure from the Western powers to endorse the international intervention in favour of the rebel groups.

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About 75 Chinese companies operated in Libya before the war,with about 36,000 workers implementing nearly 50 projects worth billions of dollars. India’s interest too is substantial but lesser in scale than that of China.

When the Western powers sought to get international sanction to mount pressure on Gaddafi in March,China preferred not to use its veto and chose to abstain. India joined the Chinese in abstention along with Russia,Brazil and Germany.

The inability of the Western intervention,led by France and Britain and the chaotic rebel coalition to quickly get rid of Gaddafi seemed to justify the conservatism of Beijing and Delhi,expressed in terms of respecting territorial sovereignty and non-intervention in the internal affairs of developing countries.


While it avoided contesting the status quo in Libya,Beijing was smart enough to recognise the prospect of rebels coming to power in the not too distant future. Therefore Beijing opened a channel of communication with rebel groups. According to informed sources,India too has been in touch with the rebel groups.

With Gaddafi now set to become a footnote,China and India are under some compulsion to deepen ties with the rebels who might become Libya’s new rulers in the coming weeks and months.

China and India will also have to make up their minds on how best to organise the post-Gaddafi political order in Libya and how the rest of the world might contribute to peace and stability there. The question is whether they simply tail the Western powers in Libya or will develop a voice of their own.


Meanwhile,there is no forgetting Libya’s oil wealth. According to Western news agencies,European oil companies are expected to gain ground in Libya,while the Russian and Chinese oil companies might be asked to revise the contracts they signed with Gaddafi.

“We don’t have a problem with Western countries like Italians,French and UK companies. But we may have some political issues with Russia,China,and Brazil,” Abdeljalil Mayouf,information manager at Libyan

rebel oil firm AGOCO,told Reuters. Shares in European firms — Eni ,Austria’s OMV and France’s Total — rose by 3-5 percent on Monday,Reuters added.

First published on: 23-08-2011 at 11:59:51 am
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