Govt turns its attention to oil and gas, plans new MEA division of energy security

New Delhi
28 June 2007

New Delhi has proposed to create a new Division of energy security
in the Ministry of External Affairs. It is expected to be headed by a diplomat of joint
secretary-rank. "A decision is likely to be taken soon," a source privy to the decision-
making process in the government told this newspaper.

The move comes after New Delhi invested considerable human and political capital in
the ongoing negotiation for a civilian nuclear cooperation agreement with Washington.
With this proposal, New Delhi has signalled its intention to turn to more secure forms of
energy, like fossil fuels and hydrocarbons. It hopes to marshal its foreign policy to
revitalise its engagements with key oil producing and exporting countries or regions,
forge strategic energy partnerships and secure fossil fuel and hydrocarbon resources
that will sustain India's high economic growth rates.

The new Division will accordingly be mandated to provide diplomatic advice for India's
international engagements in the area of oil diplomacy. It will be the nodal agency to
liaise with the five ministries or departments of power, coal, petroleum and natural gas,
non-conventional energy and atomic energy. "Today we are fragmented, therefore there
is a need for one ministry to pull together our international effort. The Ministry of
External Affairs will not replace those five ministries or departments but give diplomatic
support to our international engagements," the source said.

It will have building up alliances in its charter. It will also address sustainability issues.
Coal is expected to remain the base for India's energy security but with climate change
and carbon emissions becoming a concern worldwide, India will need to employ
diplomatic resources at multilateral fora. "Energy security has gone beyond geopolitics
to include sustainability issues. One cannot [keep exploiting] the earth to grow ... there is
a need to be sensitive to environment," the source said.

According to the source, in all the future scenarios documented by the Planning
Commission, in its report titled "Integrated Energy Policy", in September last year, fossil
fuels would constitute between 74 per cent and 85 per cent of India's energy mix as
against 96 per cent at present. "Even if a 20-fold increase takes place in India's nuclear
power capacity by 2031-32, the contribution of nuclear energy to India's energy mix is
also, at best, expected to be 4.0 to 6.4 per cent. Hence the need to obtain energy
resources from abroad and hence the need for oil diplomacy," the source said.

An American academic, Prof Bruce Podobnik, author of "Global Energy Shifts: Fostering
Sustainability in a Turbulent World", suggests that by 2060, nuclear energy would go out
of fashion and natural gas and renewables would gain currency.

Another source said that India needed a working mechanism to give an impetus to
bilateral, regional and global engagements aimed at promoting diversification of
hydrocarbon supply sources, long term LNG (liquid natural gas) contracts and trans-
national gas pipelines. The Ministry of External Affairs's skills could be leveraged to
make energy a part of larger politico-economic relationship with countries. "The Ministry
has knowledge of the full extent of relationship with countries, [so] there is enough space
available for it to play a role without affecting the other ministries," the source said.

The new Division will also seek to supplement the efforts of the Energy Coordination
Committee headed by the Prime Minister. The Energy Coordination Committee is the
apex body for all energy related issues. It was constituted on 13 July 2005. It has held
eight meetings so far.

The Ministry of External Affairs has many divisions. Some are territorial divisions, like
Americas and Europe West, named after geographical indicators. Others, like
disarmament and public diplomacy, were created to meet certain special needs. The
proposed Division of energy security will fall in the latter category.

No comments:

Post a Comment