In his message to the nation, MM Singh said, “Energy security has a global dimension. Even with the best domestic effort our dependence on imported energy is expected to increase. We need assured access to imported energy supplies and also access to new energy related technologies. This means we need sensible policies that can promote economic partnership with countries that have energy resources and technologies. We also need a proactive foreign policy, protecting our access to such resources and to foreign technology.”
The MEA has a division on energy security created a few years ago with the express purpose of starting energy dialogues with a whole range of countries that would help India explore more and varied sources of energy across the spectrum. Its record has been patchy, at best. For instance, India has an energy dialogue with the US, but that is conducted by the deputy chairman of the Planning Commission. Other energy dialogues are conducted by different ministries - petroleum and natural gas, power, water resources and renewable energy, even mines, not to speak of the PMO and DAE which plays the nuclear energy sector in total secrecy. The foreign office barely gets a word in edgeways.
Most large countries have a single ministry handling energy issues. India has seven. The result of this plurality is there is no central approach to securing energy resources or technology from overseas. It often results in one of two things - needless duplication, or missed opportunities, particularly when dealing with fleet-footed countries like China.
In the past five years, India has cut its energy dependence on Iran, shifting a lot more of its oil acquisitions to Saudi Arabia and the Gulf states. However, Iran remains a major source of energy for India, because India wants to maintain a “balance” in the Middle East - essentially between Sunni Saudi Arabia and Shia Iran. As the Middle East and Arab world continue to be unstable and in the throes of popular protests for the foreseeable future, India will need to invest more heavily in understanding the nature and future of these protests and how they might affect energy flows to the east. For instance, Iraq should be emerging as a major oil source for India as its oil sector goes onstream again. Israel’s bidding fair to becoming a gas giant and it wants to sell to India. Can India diversify gas sources from Qatar to countries like Israel?
Central Asia too is a promising source of energy for India. Kazakhstan is a crucial source for both fossil fuels and uranium. But transportation to India is almost impossible. Therefore, India prefers to look at Africa and SAustralia.
However, India’s quest for energy security now has to take couple of other factors into account - first, a resource nationalism among supplier countries particularly in Africa; and secondly security of transportation of energy. India’s energy security foreign policy has to be closely connected with both its Indian Ocean and South China Sea strategy as well as its Middle East policy, as well as climate change policies. All these policies currently work in silos in the Indian government, which does not make for anything “proactive”.
Ultimately, India’s energy security challenges are internal - there are serious challenges in “energy governance”, pricing of resources and power tariffs are distorted, which means that power projects dependent on imported coal are finding it impossible to go onstream.
The nuclear sector had brightened with the passage of the India-US nuclear deal. But between Fukushima and a crazy nuclear liability law that is keeping Indian and foreign nuclear companies from the Indian market, the future of nuclear power in India has dimmed.