Mains Paper 2: IR | Bilateral, regional & global groupings & agreements involving India &/or affecting India’s interests
From UPSC perspective, the following things are important:
Prelims level: India-Mongolia cultural ties
Mains level: India-Mongolia Bilateral Relation and its importance.
India funded oil refinery in Mongolia
- Mongolia launched construction of its first oil refinery
- It is a long-awaited project that is funded by India and designed to end the country’s dependence on Russian fuel.
- The oil refinery, in southern Dornogovi province, will be capable of processing 1.5 million tonnes of crude oil per year
Benefits for Mongolia
- Mongolia’s new refinery, planned for completion in late 2022, will meet all of the nation’s demand for gasoline, diesel, aviation fuel and liquefied petroleum gas (LPG).
- Earlier it was solely dependent on Russia for petroleum, though it exported crude oil
- By establishing this strategically important oil refinery, the national economy will become independent from energy imports, and fuel and commodity prices will be stabilized
- The project is expected to boost Mongolia’s gross domestic product by 10 percent, it said.
Indian Credit: Slow but steady
- A Mongolian oil refinery has been discussed since 1997, but while several projects were approved, none have been completed.
- The refinery’s financing is part of a $1 billion credit line agreement between Mongolia and the Export-Import Bank of India, made during a 2015 visit by Prime Minister Modi.
India-Mongolia Bilateral relations
- Mongolia, a large landlocked country wedged between giants China and Russia, has a population of just 3 million. Almost half its people live as nomadic stock herders.
- Mongolia considers India a “third neighbor” as well as a “spiritual neighbor” (the late venerable Kushok Bakula Rinpoche, a Buddhist monk who is revered in Mongolia, was the Indian ambassador to Ulaanbaatar for 10 years).
- India shares historical relations with Mongolia in terms of culture from over 2700 years.
- Nomadic Elephant was the Counter-Terrorism joint military exercise conducted by India and Mongolia in 2016