Venezuelan crisis going towards global problem
South American country Venezuela is currently undergoing unprecedented political crisis and this is a long-running economic crisis. The protests over the demand for President Nicolas Maduro’s resignation in Venezuela have become violent. Chief opposition leader Juan Guido has declared himself an interim president. This crisis of Venezuela has divided the world into two halves and gradually the crisis is moving forward towards globalization. States like Russia and China are openly in favor of current President Nicolas Maduro, if the US and European countries are in support of Venezuelan opposition leader.
The current crisis of Venezuela and the world divided into two camps
The protests over the demand for President Nicolas Maduro’s resignation in Venezuela have become violent.
Leading opposition leader Guido has declared himself an interim president and has got the support of powerful neighbors like America, Canada and Brazil, Colombia and Argentina.
The European Union has also demanded a re-election in Venezuela and supported the Guido-led National Assembly.
Russia, China and some other countries have announced the support of Nicolas Maduro. Russia has warned that Guido’s announcement has opened a direct route to ‘chaos and bloodshed’.
China is also opposed to any foreign arbitration in Venezuela. China says that it supports the efforts of Venezuela to preserve national sovereignty, independence and stability.
Turkey, Iran, Mexico, Cuba and some other countries have also announced support for Nicolas Maduro. They also got support from countries like Bolivia, El Salvador and Nicaragua.
In a latest developments, Russia has once again offered mediation to resolve the crisis … and Venezuela’s Supreme Court has banned leaving the country of self-proclaimed President Juan Guido.
What will be the impact on India?
The political and economic crisis in Venezuela has deepened, which has increased the concern of India.
Apart from America, only India is a country that buys oil by giving cash to Venezuela.
India is one of the top countries in terms of buying oil from Venezuela.
Venezia is the fourth largest country in which India imports oil from countries.
Due to sanctions on Iran, India has already undergone difficulties in oil imports.
The ban on Venezuela’s oil companies by the US can increase the chances of India.
India has also signed a bilateral agreement with Venezuela for cooperation in Hydrocarbon Sector and has also invested in Venezuela’s oil sector.
In India, the oil industry and the pharmaceutical industry are monitoring Venezuela, because Venezuela is an important market for India’s pharmaceutical industry despite losses due to late payment.
Income from India’s sale of oil is also a major source of foreign exchange for the Government of Nicolas Maduro. However, due to the falling prices of crude oil in the international market, this earnings has now dropped to half.
What is the reason for the immediate crisis?
Nicholas Maduro took power after the death of President Hugo Chavez in March 2013
In April 2013, Maduro defeated the opposition in Venezuela and took over the presidency.
In December 2015, opposition Democratic Integration Coalition took control of the Venezuelan National Assembly.
In March 2016, the Supreme Court took over the charge of the National Assembly.
President Maduro was accused of killing democracy in July 2017, and there was talk of a referendum to grant legislative body permission.
Maduro again became President in May 2018. This is his second term which will last for 6 years.
Opposition charged with rigging in elections US and Canada, including 14 Latin American countries, refused to recognize the elections.
In January 2019, major opposition leader Juan Guido declared himself the president. The US, Canada and the European Union recognized.
Chavez made revolutionary changes
In fact, Chavez, the predecessor of Maduro, took over the reins of the country after seeking the majority share of the oil companies in the mainstream, and sought the largest share of oil companies’ revenue to meet the healthcare, education and basic needs of the poorest of the poor. Spent on the items. After becoming the President of the country, Chavez nationalized many companies, increased tax and worked for the poor, health, education and housing. His work in the social sector made Chavez the Messiah of the rich country of oil. Like made. Until the price of oil in the international market rose, it was all right, but today the falling prices of oil has raised a mountain of troubles in front of Venezuela. There is inflation on the sky … People are worried for everyday things … and the backbone of the economy is going to decrease day by day.
Story of Venezuela’s economic downfall
Today in Venezuela filled with oily oil, people are plagued by the lack of expensive and essential things. The economy has collapsed and unemployment, crime and chaos prevail.
In August 2018, the Venezuelan government devalued 96 percent of its currency Bolivar to come out of the financial crisis .
The financial crisis of Venezuela, which has a population of 30 million, started in 2014 when the cost of crude oil in the international oil market decreased by two-thirds.
With this, the country’s income has decreased and in the last 3-4 years, the earnings from oil sales have been around 40 per cent.
Earlier in the year 2016, the Venezuelan government decided to replace the banknotes of the highest value 100 Bolivar bank with coins.
The Venezuelan government took this decision to deal with the problem of long-standing food and other basic things and the problem of smuggling.
It was also meant to ban the ‘mafia’ so that they could not send black money out.
The rate of inflation here is the highest in the world in Venezuela’s serious economic and political crisis. Today, the situation is such that in Venezuela, people go to the market by paying a note in the bags and they are buying the little things needed by the money.
Venezuelan Virtual Currency ‘Petro’
In February 2018, President Nicholas Maduro had launched a new virtual currency to save Venezuela from economic catastrophe and asked Venezuela to use this new currency from oil, gas, gold and diamond industries. Venezuela Virtual currency is the world’s first country to introduce ‘Petro’. The Venezuelan government presented 3.84 million units of petro for initial sale. ‘Petro’ is the world’s first government-recognized cryptoconference. In view of the fall in oil prices and falling prices of current currency Bolivar, it was said that the new virtual currency will help Venezuela deal with money transactions and blockages and financially stand on its feet.
Oil is based on Venezuela’s economy
Almost two decades ago, Hugo Chavez liberated Venezuela from the trunk of oil companies, but now that Venezuela is surrounded by misery and difficulties.
With the policies of Madhu’s successor, Chavez, the country is also looking at the political difficulties with economic difficulties.
Actually, Venezuela does not have any domestic industry other than oil and import is the only way for all things.
People do not have money after falling oil prices and they are also having difficulty for medicines and everyday needs.
Venezuela has a large reservoir reserves of Saudi Arabia, but the oil here is of a different kind, which is called heavy petroleum . Heavy petroleum is hard to refine and cost is also high. It is true that Venezuela’s crude oil costs less compared to other countries. Nevertheless, 96 percent of Venezuela’s total exports is only oil.
Taking an important economic step to put pressure on Venezuelan President Nicolas Maduro to hand over power to the opposition, the US Trump Administration has banned Venezuelan government oil company PDVSA. Under this restriction the company’s properties will be freezed in the US jurisdiction, and no American will be able to do any business with this company.
American diplomats first removed the country given, then taken back the decision
Venezuela has now postponed the order to leave the American diplomats’ country to reduce the potential conflict with the US. In fact, the United States had decided to take the side of the opposition leader in a deep crisis in Venezuela. After this Venezuelan President Nicholas Maduro decided to break up with the United States and termed this move of the Trump administration an attempt to overthrow. Later, he withdrew his order to leave the country in 72 hours to diplomats.
US resolution dropped in Security Council
As the interim President of Venezuela, the American proposal to get Juan Guido’s recognition of the United Nations could not be resolved. This proposal could not go forward due to Russia and China’s veto in the Security Council . Russia and China’s temporary Security Council member South Africa and Equatorial Guinea also opposed the American proposal. The 15-member Security Council meeting was convened at the request of US Secretary of State Mike Popeo. The US raised this move after recognizing the Venezuelan opposition leader as the interim president.
Maduro ready for talks
Venezuelan President Nicolas Maduro, who has been undergoing political crisis, has agreed to negotiate with the opposition to resolve the crisis, but he dismissed the International Ultimatum to announce the election in eight days. Maduro says that he is ready to negotiate with opposition for the well-being of Venezuela and is in favor of holding parliamentary elections soon, because it is the best way to solve political problems. But he dismissed the possibility of holding presidential elections ahead of time, saying that for that, we have to wait till 2025. Significantly, Maduro was re-elected for the presidential election in May last year.