Diplomatist Magazine Diplomatist September 2019 | Page 18

SPECIAL REPORT
needs at market price with nearly 50 percent of consumption
loans payable over 25 years at an interest rate of 2 percent.
PetroCaribe has provided discounted oil to millions. The 17
beneficiary countries include even ideological opponents.
With the oil sector in decline, petroCaribe has struggled
for more than a year now to meet the requirements of the
member-countries.
The world will never know how much the windfall oil
profits Hugo Chavez ploughed into ALBA-TCP projects.
Some US$20 billion were reportedly spent under PetroCaribe
alone between 2005 and 2010. Chavez spent another
estimated over US$30 billion in ALBA’s grand national
projects. Some of these initiatives included famously Cuba’s
‘Si, Se Puede’; Nicaragua’s ‘Programa Hambre Cero’ beside
the PetroCaribe. The grand national projects are social
projects implemented between two or more member-countries
by state-to-state grand national companies – as against
transnational corporations. As of February 2019, the Si, Se
Puede literacy programme had taught reading and writing
to more than 10 million across 32 countries. Under Mission
Miracle, some six million in 37 countries have been cured
of visual ailments. PetroCaribe’s vast network of energy
pipelines and terminals link the ALBA countries. Fibre optics
connects Cuba, Venezuela, Jamaica, Nicaragua and others.
The Bank of ALBA, which was set up with an initial capital
of $1billion funds the grand national projects.
ALBA was a political heavyweight which punched above
its weight – at its peak during 2004-14. It was a wealthy,
energy-rich group that could disrupt the regional balance
and set agenda. Venezuela bank-rolled its agenda while
Cuba provided expertise and technical know-how. Member-
countries defined the common position and voted as a bloc.
Its purposeful lobbying and financial resources allowed it to
occasionally drive the political agenda of the Organization
of American States (OAS) and the Union of South American
Nations (UNASUR). The 7th summit in 2009 explored the
idea of an ALBA defence pact. Nothing was ratified, but Evo
Morales went ahead to set up ALBA’s Regional Defence
School in Santa Cruz to develop the ‘common defence
doctrine’ of ALBA.
Bolivarian Alliance is in crisis. There is a perceptible
ideological disarticulation and political backtracking.
Venezuela and Cuba – the linchpin of the Bolivarian Alliance
– are under intense US hostility. The Venezuelan economy
is half the size of what it was in 2013. Cuba has significant
liquidity problems worsened by new US sanctions and
Daniel Ortega of Nicaragua has responded popular protests
with brutal repression. Ecuador has left ALBA; Saint Lucia
did not attend the last summit. Bolivia is reaching out to
the newly-formed ‘ideology-free’ Forum for the Progress
of South America (Prosur). Some of the Caribbean island-
nations – all beneficiaries of PetroCaribe – have criticized
Venezuela in OAS and the UN. Venezuela stands expelled
from OAS, suspended from Mercosur; and UNASUR, the
second leg of the Bolivarian Alliance, stands gutted. The 16th
Summit of Heads of State and Government, held in Havana
on 14 December 2018, was attended 11 member-countries:
Antigua and Barbuda, Bolivia, Cuba, Dominica, Grenada,
Nicaragua, Saint Kitts & Nevis, Saint Lucia, Saint Vincent and
the Grenadines, and Venezuela. Amidst cries of “vivas” to the
ALBA, the leaders noted the return of the right in the region and
open US hostility towards Venezuela and Cuba. It described
the situation as ‘neocolonial’ offensive. Venezuelan President
Nicolas Maduro admitted that ALBA has social achievements
to its credit but has failed in economic integration.
Simon Bolivar had the dream to establish a grand nation-
state in South America which would act as an independent
paradigm in international affairs. Well, the dream has receded
once again into the future.
What about India and its engagements with ALBA-TCP?
India’s emphasis has been on building close bilateral relations
with individual countries in the ALBA group, with a focus
on economic and trade exchanges. Indian business firms
remain engaged in the markets in Bolivia, Cuba, Ecuador,
Venezuela and others for lithium, oil and gas, bio-fuels,
iron-ore, pharmaceuticals, information technology, etc. Of
all the ALBA countries, trade relations with Venezuela have
been strongest. In 2006, Hugo Chavez visited India and in a
spirit of South-South Cooperation had invited India to join
in the economic and social transformation his country was
going through. A political nod from the UPA government of
PM Manmohan Singh encouraged the public sector ONGC-
Videsh Ltd. (OVL) which became the first Indian oil firm to
bid for E&P in San Cristobal oilfield. It is worth recalling that
it was only after the nationalization of oil that doors for Indian
firms opened in a market which always tightly controlled by
American and European oil giants. Footprints of Indian oil
and other firms expanded further into Cuba, Ecuador and
Bolivia – all state-owned economies. Make no mistake: the
‘pink-tide’ that swept ALBA countries in the previous decade
proved a boon for the Indian business. Venezuela became the
third largest supplier of crude to India; at $7.38 billion, it was
still the largest oil exporter to India from LAC in 2018. Nearly
200 Indian firms present in the LAC region are all guided
by business logic in their operations. New US sanctions and
the domestic churning in Venezuela and adverse economic
scenario in Bolivia, Cuba and Nicaragua does not make
ALBA an attractive proposition for the Indian business – at
least for now. n
* Author is Professor (retd.) of Latin American Studies
Jawaharlal Nehru University, New Delhi
18 • Extraordinary and Plenipotentiary Diplomatist • Vol 7 • Issue 9 • September 2019, Noida