India and Russia Agree to Resolve Investor Concerns in Oil and Gas Projects
India and Russia discussed strengthening energy cooperation, agreeing to resolve investor challenges in their oil and gas sectors. Key issues included ONGC Videsh's concerns over equity oil for Sakhalin-1 and Indian firms' dividend repatriation from Russia. The talks, held during President Putin's visit amidst US pressure on Russian oil imports, also aimed to deepen ties across various sectors. Energy remains a crucial pillar of their strategic partnership, driving record bilateral trade despite recent declines in oil exports following US sanctions.
During a summit in New Delhi, India and Russia, represented by Prime Minister Narendra Modi and President Vladimir Putin, agreed to strengthen energy cooperation and expeditiously resolve issues faced by their investors in the oil and gas sector. A primary concern for India is ONGC Videsh's (OVL) struggle to receive equity oil for its 20% stake in Rosneft’s Sakhalin-1 project, with Russia preferring dividend payments. Additionally, Indian energy companies have faced difficulties repatriating dividends from their Russian assets. The discussions also covered expanding cooperation in oil, petrochemicals, LPG, LNG, and related infrastructure, alongside broader ties in trade, technology, connectivity, and defense. These talks occurred amidst significant geopolitical context, including US pressure on India to reduce Russian oil imports and imposed sanctions on major Russian suppliers like Rosneft and Lukoil. Both nations affirmed energy cooperation as a vital pillar of their 'special and privileged strategic partnership.' Indian investments include OVL's stakes in Sakhalin-1, CSJC Vankorneft, LLC Taas-Yuryakh, and Imperial Energy Corp. Plc, while Rosneft holds a significant stake in India’s Nayara Energy. This energy partnership has propelled bilateral trade to a record $68.7 billion in FY25, predominantly driven by India's crude oil imports from Russia, which became India's top supplier due to discounts offered post-Ukraine war, though exports have slightly declined after recent US sanctions.
