Petroleum Ministry trying to scuttle Aramco-RIL deal: Analysts

New Delhi: While Prime Minister Narendra Modi and the entire leadership are “encouraging” businesses to invest in the country with “ease of doing business” reforms, the Petroleum Ministry appears to be using the media to scuttle the Saudi Aramco-Reliance Industries (RIL) deal, according to analysts.

On August 12 this year, state-run Saudi Aramco entered into a non-binding letter of intent with the Mukesh Ambani-led RIL to purchase a 20 percent stake in the Indian major’s oil to chemicals division.

“It looks like the Petroleum Ministry is pulling in the opposite direction to that of PM Modi”, one analyst said. Some others are already interpreting the making public of the long-pending sale matter as a move to scuttle the Aramco deal at the eleventh hour and are wondering who is helped by such an action.

India and Saudi Arabia have sought to strengthen mutual economic ties between both countries also for strategic considerations.

“The Petroleum Ministry’s incessant interference in the arbitration matters undermines the government’s foreign economic policy”, another analyst said.

The government should be more concerned about whether state-run explorer ONGC would be able to pay its 40 percent share of the final arbitration award amount if any, he added.

The Arbitration Tribunal issued a partial award in October 2016 in the arbitration case between the government and BG Exploration and Production India Ltd (BG) and RIL regarding the Panna-Mukta and Tapti Production Sharing Contracts (PSCs). (IANS)

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