India-US strategic partnership to strengthen energy security: Dharmendra Pradhan

Union Minister of Petroleum & Natural Gas Dharmendra Pradhan has said that India is making a quick transition into cleaner fuels, with a predominant role for natural gas and renewables, and there is greater opportunity for India and the US to evolve a new paradigm of engagement. He was addressing the 2019 edition of the India-US Forum.

He also shared India’s approach in the next five years. “Hon’ble Prime Minister of India Narendra Modi announced that India will target to become a US$ 5 trillion economy by 2024. It is natural to expect that the energy sector will assume a prominent role in achieving this target.”

The minister said that India’s energy consumption is projected to grow at 4.2 percent per annum up to 2035, faster than all major economies of the world. Driven by strong economic development, India’s share of total global primary energy demand is set to double to 11 percent by 2040.  

In June 2017 Prime Minister Narendra Modi and President Donald Trump had envisioned a Strategic Energy Partnership between India and US. The Strategic Energy Partnership was launched in April 2018. The minister said, “The partnership provides for deeper and more meaningful engagements through government and industry channels. We need to collectively enhance energy security, expand energy and innovation linkages across our respective energy sectors, bolster our strategic alignment, and facilitate increased industry and stakeholder engagement in the energy sector.”

While speaking at the forum he informed that India’s hydrocarbon imports from US have exceeded the US $ 6 billion mark and US has emerged– for the first time– among the top ten sources of crude oil for India, with 9th position in 2018-19. 

Talking about the changes taking place in India, he said that there is already a cardinal shift in energy production in India with emphasis on renewables and other environmentally sustainable forms of it. “Our renewable energy target of 175 GW by 2022, with solar target of 100 GW by 2022, is well on its way to be achieved.”

The International Energy Agency, in its World Energy Investment 2019 Report, highlighted that foreign energy investments in India grew to US $ 85 billion. This marks a record 12 percent increase, and the highest growth of energy investments anywhere in the world. The minister informed that the government is moving simultaneously on energy infrastructure expansion. Augmenting power generation capacity, improving energy efficiencies across the board and faster integration of more renewable energy with the grid are proceeding apace. Simultaneously, hydrocarbon investments in a number of areas such as refinery upgradation, petrochemicals, pipeline, city gas network, LNG terminals, marketing network and so forth, are on the increase.

Given the complex and fast-growing nature of India’s energy needs, the country depends on all sources of energy that are secure, efficient, affordable and sustainable. “We have embarked on a realization of a gas-based economy. The share of natural gas is set to increase from 6 percent to 15 percent in the primary energy mix by 2030. To achieve this vision, we have entered into long-term contracts for LNG imports from many countries, including with the US. The imports from the US are increasing progressively since the imports started in March 2018. The India-US Gas Task Force set up last year has begun its work. It will prepare a blueprint for greater engagement of the US in realizing a gas trading hub in India, which is our next priority.”

The minister outlined the four pillars of strategic energy partnership – Oil and Gas; Power and Energy Efficiency; Renewable Energy and Sustainable Growth; and Sustainable growth in Energy sector, which covers the key priorities of India’s energy engagement. 

“There is already enough momentum through our existing cooperation on clean energy. It needs to be aligned to support India’s ambitious renewable and clean energy targets by supporting research and deployment of clean energy technologies.  I invite US oil and gas majors to join innovative and attractive schemes for oil and gas exploration and production in India.”

He also informed that Indian companies are also acquiring quality producing oil and gas assets in the US. “Presently, Indian public sector companies have already invested in the US worth approx. US$ 500 million. Our companies are exploring more investments opportunities in the upstream sector.”

The minister emphasized on the growing convergences in energy sector between India and the US and hoped that the great potential that exists in energy cooperation would enable India and US to scale new heights in their bilateral engagement.

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