Asia is fast emerging as the new centre of global economic growth resulting in significant realignments in global energy equations. The two Asian giants i.e. India and China are in such a high growth trajectory that their requirement for energy cannot be met by their internal reserves alone. Asia led by China and India including Japan, Taiwan and South Korea make up the leading market for energy. This shift is happening alongside with certain developments on the supply side as well wherein Russia is rapidly emerging as a major oil and gas exporter. Also the Caspian region alongwith the countries on its eastern flank are now a force to reckon with due to their energy reserves. Estimates of energy reserves in Caspian region might vary wildly, but investments flowing into the region indicate presence of large reserves which are enough to merit a serious interest on part of investors as well as energy insecure neighbors. Another aspect is the high proportion of gas amongst the energy deposits in Russian and Caspian region which assumes huge importance in the context of clean energy in a post Kyoto world [2] .
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These developments are taking place at a moment in history when US, the biggest consumer and importer of energy resources in the world, is trying to move away from its dependence on Middle Eastern energy supplies. US imports half of its hydrocarbon requirements from foreign sources, but only 30 per cent of its oil imports come from the Gulf region, the rest being supplied mostly by Mexico, Venezuela, Colombia and others. While the decision to move away from the Middle East and Gulf oil was reinforced by the unfortunate incidents of 9 /11, the US resolve to reduce its dependency from this region goes before September 2001. Long before Iraq entered the US radar screen as a possible target of attack, the US had been fine-tuning its energy policy in an attempt to access new sources of oil and gas. President George W. Bush’s controversial energy policy of 2001 focused on how to reduce American dependence on Gulf oil, even if it meant dumping the Kyoto Protocol and drilling in the pristine snows of Alaska [3] .
All these have far reaching consequences for the main energy importing countries of Asia. Japan could be the main beneficiary of Russian oil and gas supplies while Central Asia and Russian Far East can offer supply diversification for China. Finally, India, geographically far from both Russia and Caspian, will continue to import its oil supplies from West Asia and Persian Gulf region. Therefore, while Caspian and Russian energy sources go and satisfy European and even North American demand, they could release Middle East and Gulf oil and gas for both China and India [4] .
Central Asian Region and its Significance for India. After the collapse of the Soviet Union in 1991, five new Central Asian republics emerged-Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. Central Asia’s rich energy resources and India’s persistent energy needs, combined with India’s ambitions to be a major regional and global player, have been the key driving forces behind India’s increasing presence in the region. Central Asia is also important as an avenue for access to Afghanistan, where India wants to be a major player and blunt Pakistan’s influence. India’s participation in Central Asia includes energy ties, trade and investment, and the beginnings of a military relationship. Diversifying and expanding its international sources of energy has been a major Indian policy drive for the past decade, so it is no surprise that energy co-operation is at the heart of India’s engagement of Central Asia. Kazakhstan has substantial oil; Turkmenistan has gas; Uzbekistan has more modest hydrocarbon resources; and Kyrgyzstan and Tajikistan have surplus hydro power. The big challenge that remains unresolved, however, is how to get Central Asian energy resources to the Indian market [5] .
METHODOLOGY
Statement of the Problem
5. This paper seeks to study and analyse the growing economic importance of importing energy resources from CAR nations by India, with specific reference to oil and natural gas and recommend actions to achieve a long term foothold in CAR nations to secure its energy requirements.
Hypothesis
6. India is facing shortage of energy resources and with rapid industrialization in the country, the situation is likely to become more acute in future. Hence, India needs external sources/ agencies to bridge the gap between demand and supply of energy. Hydrocarbon rich CAR nations which are yet to be tapped to their potential could be a panacea for India’s deficient energy requirements.
Justification for the Study
7. India’s per capita energy consumption is half of China and about one twentieth of the US. India’s energy requirements are likely to double by 2020 and crude oil imports are likely to increase by three times from the present levels with an expenditure equal to the current total foreign exchange reserves of the country.
7. Although, India is aggressively exploring possibilities to change its energy mix, its dependency on oil and gas will continue to rise. The present sources/ countries from which India is importing its oil and gas requirements are likely to maintain their current production levels or will in due course become an importing nation itself. Hence, there is an urgent requirement to explore new sources of energy. CAR nations with approx. 5% of the world oil reserves are a potential source of oil and gas. India should explore all possibilities to buy oil and gas rights and make arrangements to either transport them or be able to exchange them with neighbouring nations.
8. Owing to its historical links with the region India is in an exclusive position to utilise these resources for its development needs. Therefore, the problem is how India can best tap these energy resources in CARs. In doing so, India would need to consider the following:-
(a) Critically examine its own energy requirements, CARs energy potential and economic viability of importing energy resources from CAR nations.
(b) Examine the ‘New Great Game’ between various nations to exploit the energy resources of the CARs and develop skilled method to influence the advantage.
(c) Embracing novel methods to tap the energy potential of CARs and thus overcoming the handicap of geography of the region.
Scope
9. The paper focuses on potential of CARs to meet India’s growing energy needs. Wherein, firstly it outlines the Indian energy needs, economic viability of importing energy resources from CAR nations to India and then outlines CAR’s energy situation to cover the ‘New Great Game’ between various nations in quest for control over Central Asia’s rich energy resources. Lastly, it recommends probable areas of energy cooperation between CARs and India.
Methods of Data Collection
8. The material presented in the dissertation has been acquired from the sources listed below. The detailed bibliography has been appended at the end of the paper.
(a) Book and periodicals available in the Defence Services Staff College library.
(b) Internet.
Organisation of the Dissertation
10. The dissertation is organised as follows: –
(a) Chapter II. Present and predicted future requirements of energy in India.
(b) Chapter III. Energy potential of CAR nations and economic viability of importing energy resources from CAR nations to India
(c) Chapter IV. Engagement with CAR nations to secure India’s energy needs. Prospects and obstacles to it.
(d) Chapter V. Assessments and recommendations.
(e) Chapter VI. Conclusion.
CHAPTER II
PRESENT AND PREDICTED FUTURE REQUIREMENTS OF ENERGY IN INDIA
CHAPTER III
ENERGY POTENTIAL OF CAR NATIONS AND ECONOMIC VIABILITY OF IMPORTING ENERGY RESOURCES FROM CAR NATIONS TO INDIA
CHAPTER IV
ENGAGEMENT WITH CAR NATIONS TO SECURE INDIA’S ENERGY NEEDS- PROSPECTS AND OBSTACLES
CHAPTER V
ASSESSMENTS AND RECOMMENDATIONS
CHAPTER VI
CONCLUSION
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