Venezuela Crisis 15,000 km Away: Impact on India and Its Companies

The recent U.S. military action in Venezuela, home to the world’s largest oil reserves, has sent shockwaves across global markets. For India, which imports oil from Venezuela and has several business interests there, the developments could bring both opportunities and challenges.

How Indian Companies Are Affected

Several Indian companies have invested in or operate businesses in Venezuela, spanning sectors such as energy, crude oil trading, engineering services, and pharmaceuticals. The ongoing crisis could affect their operations, investments, and supply chains.

State-run ONGC is among the most exposed, holding equity stakes in two Venezuelan oil projects. In refining, Reliance Industries has historically been a major importer of Venezuelan crude. Analysts suggest that any relaxation or removal of U.S. sanctions could benefit both Reliance and ONGC. Following the news, Reliance shares surged to a record high, while ONGC saw a marginal rise before closing about 2% lower.

Energy and Oil Sector Exposure

Indian Oil Corporation (IOC) is a consortium partner in the Carabobo Heavy Oil project, holding equity stakes. Additionally, Oil India, ONGC, and IOC jointly hold minority stakes in a Venezuelan oil joint venture. Mangalore Refinery & Petrochemicals has also historically purchased Venezuelan crude. Any disruption in Venezuela’s oil production, exports, or logistics due to the U.S. strikes could directly impact these companies.

Engineering and Pharmaceuticals

Engineers India Ltd. operates an office in Venezuela, while several Indian pharmaceutical companies have business operations there. Sun Pharma has a registered subsidiary in Venezuela, and Glenmark Pharma operates via a locally registered subsidiary. Cipla has previously exported essential medicines to Venezuela, and Dr. Reddy’s Laboratories had a subsidiary in the country until it sold its stake in 2024.

Metals Sector

In the metals industry, Jindal Steel operates Venezuela’s largest iron ore complex, making it vulnerable to any disruptions in the region.

The ongoing Venezuela crisis highlights how geopolitical developments thousands of kilometers away can have tangible effects on Indian businesses, potentially influencing investments, stock prices, and energy imports in the near term.