India opposes plan to expand sanctions list in Libya

India has opposed the proposal of western countries to expand the list of sanctioned Libyan entities by the United Nations Security Council following concerns that such a move may adversely affect its economic interests in the troubled North African nation.

Since February, Libya has been torn apart by a civil war between rebels in the western region and security forces of the long-reigning Muammar Gadaffi.

On Feb 26, the UNSC had first imposed travel bans against 16 individuals and ordered the freezing of assets of Muammar Gaddafi, four of his sons and daughter. About a month later, another UNSC resolution was passed, listing more individuals and for the first time also bringing in five entities.

In the first week of April, the western countries, which include Britain, France, Germany and the United States, circulated two different lists for expanding the group under sanctions. The proposals were made before the UNSC's Libya sanctions committee, of which India is the vice-chair.

"We have put it on technical hold, while we examine how it will affect us," a senior official of the external affairs ministry told IANS. The expansion is also being opposed by Russia and China, both of whom are also executing several projects in Libya.

While Libya's National Oil Corporation had already been sanctioned in the March 17 resolution, the new list would have named more Libyan state companies, most of them subsidiaries of Libya's National Oil Corporation.

According to officials, India is especially concerned that the asset freeze will affect the payment of contracts and salaries for Indians who had been working in that country.

"We had 18,000 Indians working in Libya. How will they be paid? It has to be made clear. There should not be any retrospective freezing of assets," he said.

Following the breakout of hostilities, India had conducted a massive evacuation of 16,000 nationals, most of them employed in the oil industry, health and education sector.

For example, Punj Lloyd had around 1,800 employees working in the country, when it was hit by violence between the rebels in the east and Gadaffi's forces in the west. The company has projects worth $1.8 billion in the country.

Indian state companies like ONGC Videsh, Oil India and Bharat Heavy Electricals Limited also had significant presence in Libya in the last five years. Oil India has three blocks in Libya with partnership with Algerian oil company, Sonatrach.

"We are in the process of collating the total dues owed to Indian nationals and companies in Libya," said an external affairs ministry official.

While India had supported the Feb 26 resolution, it had abstained from the March resolution, which had also authorised the imposition of a no-fly zone in Libya.

In its explanation vote, India's deputy permanent representative, Manjeev Singh Puri, had warned that "financial measures that are proposed in the resolution could impact, directly or through indirect routes, ongoing trade and investment activities of a number of member-states thereby adversely affecting the economic interests of the Libyan people and others dependent on these trade and economic ties".

Officials said that there was no technical limit on how long India could put a hold on the proposal.

"We will continue to put a hold on this (expansion) till our doubts are cleared," an official said.