Table Of ContentINDIA
The Emerging Energy Player
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INDIA
The Emerging Energy Player
Girijesh Pant
An Imprint of Pearson Education
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Copyright © 2008 Dorling Kindersley (India) Pvt. Ltd.
Licensees of Pearson Education in South Asia
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whatsoever without the publisher’s prior written consent.
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present in this eBook at any time.
ISBN 9788131781560
eISBN 9789332509399
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C
ONTENTS
P
REFACE VII
I ENERGY SECURITY:
T C G C 1
HE HANGING LOBAL ONTEXT
II INDIA’S SEARCH FOR ENERGY:
I E C 39
SSUES AND MERGING ONCERNS
III INDIA–GULF ENERGY RELATIONS:
R I 84
EDEFINING NTERDEPENDENCE
IV INDIA–IRAN:
T S E P 123
HE TRATEGIC NERGY ARTNERSHIP
V INDIA–RUSSIA ENERGY RELATIONS:
T E D 168
HE MERGING YNAMICS
VI INDIA–AFRICA:
P E P 195
LEA FOR NERGY ARTNERSHIP
VII ASIAN COMPETITION FOR ENERGY:
I I 234
MPLICATIONS FOR NDIA
VIII THE INDIAN ENERGY DIPLOMACY:
B S P 262
EYOND THE ECURITY ARADIGM
I 295
NDEX
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P
REFACE
It would be fitting to spell out the intent of this volume at the outset. It
is an account of the Indian endeavour to define its energy engagement
with the leading players in the globalizing energy market. The
narrative of Indian initiatives is accompanied with commentary, not
as much on the evaluation as on the content of the emerging profile.
The objective is to comprehend and define India’s global energy
interest beyond the ‘scramble for energy’ framework and reflect upon
the energy discourse from a mutually beneficial perspective in the
expanding energy space.
The energy frontiers are expanding and unfolding new
possibilities of encounters. The world energy market is undergoing
structural changes. There are more consumers and many suppliers.
Consequently, it is witnessing a realignment of power relations.
Energy has been vital in maintaining the global strategic balance.
Today it is defining relations among nations. The qualitative shift
triggered by the rise of Asian economies has its bearing on the
global strategic balance. Apparently, the Asian arrival is seen with
apprehensions. The oil flow from the Persian Gulf to Asia or the
Russian supplies to Asia with the construction of new pipelines are
seen as a diversion from the Western market. No wonder the West
is concerned about the ramifications of the Asian demand on their
energy security. Thus, the discourse on energy security demonstrates
a tension between the anxieties of new stakeholders and the fear
of old stakeholders. The divergence in perspective is detrimental
to global energy security. It is gradually recognized that the divide
is flawed because the geopolitical fault lines are losing relevance
with the sharpening of geo-economic contours of the energy space.
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VIII PREFACE
The new technology and new concerns (environment and local
community) are impinging upon the context decisively. The small
and stranded energy resources are no more inaccessible and
unviable. Yields from the wells have increased significantly. The
logistics of transport have overcome many terrain-linked problems,
though in the process they have added on to vulnerabilities as well.
Significantly, the thrust of these vulnerabilities pushes towards
collective responsibility whether it is the pooling of strategic reserves
to meet natural or political calamities or the security of sea-lanes.
Moreover, it is widely recognized that even if the hydrocarbon is
non-renewable, the price is soaring, more for political reasons than
economic scarcity. Clearly, the emerging imperatives are directing
energy security towards a paradigm of collective mode.
Energy security became a part of the Indian policy construct at the
beginning of this century. In fact, its energy security policy is still in the
making. Yet the initiatives taken by the country do reflect the underlying
concerns and, to some extent, the thinking on this issue. Indeed with
more than 70 per cent import dependence, India has to factor energy
security in its domestic and foreign policy. India is emerging as a
leading energy market; hence, all leading suppliers are attracted to it.
Yet, as history demonstrates, energy deals are seldom signed according
to commercial concerns alone. The loss–gain matrix is much more
complicated and therefore requires a diplomatic mode of transaction.
Indian energy diplomacy is gradually gaining grounds. It initially
followed the prevailing modes, even aped the main competitors, but
soon discovered their limitations. So it decided to change its style
of diplomacy, though the content remained the same. How India is
positioned in the global energy market, what its stakes are and how it
could negotiate with them, the nature and profile of its engagement
with different energy suppliers, and its understanding of the perceived
competition are the concerns of the book. The attempt is to profile the
Indian energy relations in the global context and fathom the issues
which India is facing in defending its energy interest in the changing
world market. The study focuses on the external dimensions without
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PREFACE IX
disregarding the need to augment domestic exploration and production.
On the contrary, it argues for a re-conceptualization of energy security
in a wider frame of reference where domestic and external dimensions
are duly recognized. It questions the Western perspective of defining
energy security in limited terms such as ‘access at affordable price.’
Certainly, given the wide range of issues, it cannot be claimed that
all of them are covered, yet in a modest way this book provides the
leading trends of India’s foreign energy relations.
This book has drawn heavily from the series of lectures that I have
delivered on different facets of India’s energy security policy over the
last three years. During the course of time, I realized that the material
on this subject is highly scattered and stranded. Since energy security,
both in general and in the Indian context, is no more an academic
passion but a concern of high politics, it deserves a serious scrutiny.
Its importance can be gauged by the fact that it appears in almost all
important bilateral deals. It is time that an audit is done of the initiatives
taken, or not taken, in this direction. Obviously, before the audit an
inventory of the efforts made so far should be prepared. This book
attempts to make such an inventory. It has eight chapters elaborating
and profiling the range of issues impinging on the Indian energy scene.
It needs to be clarified at the outset that for the purposes of this book,
energy refers to only hydrocarbon and the issues covered are related to
external dimensions of the subject. It begins by outlining the energy
security issues in the global context. The thrust of the argument is that
the emerging energy security concerns are pressing for a rewriting
of the script in view of the fast-changing global context. The India-
centric issues are elaborated upon in the second chapter. The theme
of the chapter is that in view of the increasing energy consumption
and the changes in the energy mix triggered by market-based growth,
India has little option but to augment the supply of hydrocarbons
both from domestic and external sources. The growing imports
have made it imperative to comprehend the issues, their multiple
dimensions and the need to evolve a strategy. The next four chapters
provide the emerging trends of the Indian energy engagement with
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