Agreement signed between IOCL and The French Island of Reunion

The signing of an agreement between Indian Oil Corporation and the French island of Reunion for import and distribution of refined petroleum products marks a key milestone in the efforts of the Indian Ocean island to develop ties with India.Located about half an hour flight from Mauritius, the French territory of Reunion has been trying to develop its business and cultural relationship with India.This is not just because of the fact that Persons of Indian Origin make up for over one third of the 800,000 strong population of the island. The main reason behind the island – an overseas region of France – seeking to develop closer ties with India is business.As the European Union, and specially France, pass through an extremely turbulent economic crisis, the Reunion economy too has been suffering tremendously.

The island, which remains dependent upon the mainland for all essential supplies, also has a monopoly in petroleum distribution, with the Société Réunionnaise de Produits Pétrolier (SRPP) being the sole player.The SRPP has become extremely unpopular with the local population due to extremely high prices and problems in distribution. This has resulted in strikes, protest and general discontent with the situation in the Reunion.Hence, the proposed deal with IOC is extremely crucial.

This declaration of intent comes after months of discussions between Didier Roberts, the president of the Region, and Ravinder Sareen, chairman of IOC, which will import, stock and distribute petroleum products there.”My first objective after taking charge in 2010 was to fight against the rising cost of living and the monopolies that exist in our island, especially in the essential items such as petrol or diesel. This agreement today should help in boosting competition as well as the purchasing power of the people of Reunion,” said Didier Roberts, currently on an official visit to Tamil Nadu.Though this action of going overseas for help may be seen as controversial in the mainland, it shows the commitment of the regions of France to deploy all possible means to fight the economic crisis and ease the impact of a declining purchasing power.”This alliance today has to be seen in the right perspective. The island has been hit by a strike of petrol stations who are threatened by a declining margin and the anger is rising in the streets,” said Jean Regis Ramasamy, a journalist member of the delegation from the Reunion.”The region has been subsidising the fuel to ease the pressure on the common man but this is not viable in the long term and a solution had to be found.”The agreement could see the entry of the first ever Indian petroleum company entering the French market. The intent to work together, signed today, and which both sides hope to concretise in the next three to four months, has three main points.The government of Reunion will facilitate the entry of IOC on the island and will also facilitate cooperation between the Indian firm and the private sector of the Reunion.The third key point of the agreement deals with the setting up of a refinery on the island. A technical committee comprising representatives of the private sector of the Reunion, existing service stations and representatives of IOC will be set up and will take this collaboration through its various stages, with the objective of a decline in prices.”The agreement reflects the commitment of the French government to fight inflation and to promote economic development in all the regions and territories,” said Robert.”

The Réunion is a French territory located in the African continent and the Indian Ocean. The situation of our island and our mixed population are the strengths allowing us to open ourselves towards globalisation and create a meeting point between France and global powers such as India,” said Robert.One of the first actions in this direction is the launch of a direct flight between Chennai and the Reunion by Air Austral.”Over 150 years after the first Indians arrived in the Reunion, the two territories are now connected again. This is a historic moment and finally now thousands of people from the Reunion can finally visit the land of their ancestors,” said Ramasamy.