# Iraq PM heading to India for investment, trade



## Vikrant (Aug 21, 2013)

BAGHDAD (AFP)   Iraqi Prime Minister Nuri al-Maliki is to visit India, officials said Wednesday, to push for investment in much-needed reconstruction as New Delhi looks to secure critical energy supplies.

The premier's three-day trip to New Delhi and Mumbai, the first by an Iraqi leader since the 2003 US-led invasion ousted president Saddam Hussein, comes on the heels of a visit by Indian Foreign Minister Salman Khurshid to Baghdad in June.

But the prospects of luring foreign investment to Iraq have been complicated as the country has been hit by its worst violence since 2008, with the interior ministry describing Iraq as a "battleground".

Maliki will set off on Thursday with a delegation including the ministers of oil, health and agriculture, the head of Iraq's national investment commission, and several advisors.
He is due to meet with his Indian counterpart Manmohan Singh, as well as India's President Pranab Mukherjee and other top officials and leaders, according to Suresh Reddy, India's envoy to Baghdad.

"It is a very important visit," Maliki's spokesman Ali Mussawi told AFP. "It will mark a major change in relations between Iraq and India, a big step forward."
Mussawi said discussions would focus on energy, but also housing, healthcare, education and railways.

"Naturally ... economic considerations would be a big part of bilateral discussions," Reddy said.

"Since energy is of critical importance to Iraq, and India being dependent on imported energy, so energy would constitute a very important component of the discussions."
"But it's not just trade alone."

Reddy said Indian exports to Iraq totalled around $1.3 billion in 2012, up from $740 million in 2011, while Baghdad's exports to India -- the vast majority of which were oil -- totalled more than $20 billion last year, compared to around $9 billion in 2011.

Iraq, which currently exports around 2.3 million barrels per day (bpd) of oil, is looking to dramatically boost its energy output, with officials aiming for overall production capacity of 9 million bpd by 2017.

Baghdad is almost entirely dependent on oil sales for income, and while efforts to boost energy production have resulted in a significant increase in output, steps to diversify the country's economy have sputtered.

India, meanwhile, has made clear its requirement to secure energy supplies to drive economic growth and development, with its dependence on Iraqi exports increasing as sanctions have limited Iran's oil sales.

While in Baghdad in June, Khurshid insisted that India also wanted to promote investment in other fields in Iraq.

But whereas firms from the West, Turkey, South Korea and China have sought to win major government contracts in Iraq as Baghdad looks to restore its war-battered infrastructure and dilapidated economy, Indian companies have been noticeably absent.
Considerations of investment in Iraq have been complicated by a marked spike in violence in recent months that authorities have failed to stem.

More than 1,000 people died as a result of violence last month, the United Nations said, the highest such figure since 2008, and more than 400 have been killed already this month, according to an AFP tally.


Read more: Iraq PM heading to India for investment, trade | Fox News


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## Vikrant (Aug 23, 2013)

NEW DELHI&#8212;India and Iraq on Friday signed an energy-cooperation agreement spanning oil exploration and refining as well as work toward establishing a 10-year crude oil supply agreement from the Middle East nation.

Iraq is eager to boost oil supplies to India, one of the largest oil consumers, in the face of shrinking demand from the U.S., which has been getting more of its oil and gas from domestic shale deposits in recent years.

India also wants to increase imports from Iraq, its second-largest oil supplier after Saudi Arabia, as a replacement for dwindling shipments from traditional supplier Iran amid the West's sanctions on Tehran.

Indian Prime Minister Manmohan Singh said the energy-cooperation agreement "will provide a very strong framework to further diversify our cooperation in this sector and we look forward to concrete progress in the near future."

Neither side said how much additional oil India is likely to import under the long-term agreement. India's crude-oil imports from Iraq are currently estimated at about $20 billion annually.

Earlier in the day, Indian Trade Minister Anand Sharma said that the two countries would explore the possibility of a trade-payment mechanism in their local currencies as the nations seek more partnerships in various sectors.

Last year, India introduced a rupee trade-payment mechanism with another major oil exporter, Iran. However, the international sanctions have made it tough for shippers to secure insurance for carrying Iranian oil to India.

The trade talks with Iraq follow a dispute with Iran over its detention of an Indian oil tankercarrying crude oil from Iraq. Iran has denied any political motive and alleged that the Indian tanker was polluting, but the Indian side says the vessel was compliant with laws.

Indian oil companies, which so far have not actively participated in Iraq, now appear more interested in tapping more oil from the country.

Iraqi Prime Minister Nouri al-Maliki said his country will seek partnerships with India in pharmaceuticals, chemical and agricultural sectors.

As part of the discussions, Iraq also offered state-run Indian companies exploration of three oil and gas blocks in Middle Furat Oil Field.

It also allowed three Indian oil companies&#8212;ONGC Videsh Ltd, Mangalore Refineries & Petrochemicals Ltd and Reliance Industries&#8212;to bid for the Nasiriya oil and gas project.

An analyst said that India needs to strike a balance between Iran and Iraq for its energy needs.

Sanjay Kaul, President at University of Petroleum and Energy Studies, said for India's energy needs, Iran is a "current solution" while Iraq offers a future potential.

India would probably need time to arrive at a rupee payment mechanism with Iraq similar to Iran, which essentially works like a barter trade agreement.

India, Iraq Work to Boost Oil Trade - WSJ.com


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