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India's energy demands call for good relations with Pakistan

Tuesday, 13 May 2014 - 6:00am IST | Place: Mumbai | Agency: dna

The geopolitical differences that had held up the much-talked about 'TAPI' project, a gas pipeline from Turkmenistan to Afghanistan to Pakistan to India, for over a quarter of a century have now been finally resolved. It is scheduled to be commissioned by August 2017.

India is one of the most energy-hungry countries of the world. The demand for energy in any country is directly proportional to its pace of development. According to The Wall Street Journal report of January this year, India's energy demands will surpass China's by 2035. By then, India's demands will grow by 132 per cent as against China's and Brazil's 71 per cent and Russia's 20 per cent. In fact, India's energy demands will be about double the aggregate of the non-Organisation for Economic Co-operation and Development (OECD) countries.

It is in this context that the importance of the TAPI project has to be viewed. The 1,680-km-long pipeline, starting from the Daulatabad gas fields in the Amu-Darya basin of Turkmenistan, will pass through Afghanistan and Pakistan and finally terminate at Fazilka on the Indo-Pak border in Punjab. Turkmenistan will supply 90 million standard cubic metres of gas per day (mmscmd) for a period of 30 years. India and Pakistan will get 38 million each while Afghanistan will get 14 million. The total project cost is estimated to be $7.6 billion (Rs38,000 crore) but may go up, depending on its completion in time. Time overruns will naturally lead to cost overruns. However, details of the source of funding for the project and the basis of cost-sharing by the three countries have not been made public.

In 2012, India consumed about 46.5 billion cubic metres of gas. The demand is steadily rising. Meanwhile, China has completed the first gas pipeline from Turkmenistan and started work on the second gas pipeline. The first gas line is 8,700 kms long — one linking Turkmenistan with southern China. The second one will deliver Turkmenistan gas via northern Afghanistan and through Tajikistan. Turkmenistan is China's main gas supplier. Under an agreement, Turkmenistan will deliver gas to China at 65 million cubic metres of gas every year (bcma).

The Chinese drive to secure foreign gas reserves had infused a sense of urgency at the decision-making level in India and things started speeding up. The proposal for the much talked about Iran-Pakistan-India (IPI) gas pipeline came up as far back as 1989 but was stalled later. No reason for the virtual abandoning of the project was officially given (nor even was the fact of its abandoning admitted) but it is an open secret that the deterioration of US-Iran relations and the mounting US pressure on India following the signing of the Indo-US civil nuclear cooperation deal made the project as good as dead.

The Chinese have already beaten India in securing gas supply from Myanmar. They are drawing gas from Myanmar gas fields through a pipeline. But the proposed Myanmar-Bangladesh-India gas pipeline project remains deadlocked. India is said to be unwilling to accede to Bangladesh's request to allow access to power supply from Bhutan and Nepal — the line passing through India. Several rounds of negotiations have failed to break the deadlock. With the growing competition between India and China to secure supplies of gas, India does not have much time to bargain for better terms and conditions.

There is one imponderable though. The fruition of the TAPI project necessitates cooperation between India and Pakistan at every stage. And here lies the rub. What will be the policy of the new government with regard to Pakistan? At the moment it is a million dollar question.

The author is a senior journalist

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