Pramit Mitra International Herald Tribune
Thursday, April 7, 2005
The quest for energyWASHINGTON Latin America hasn't always figured highly on India's diplomatic agenda. But the recent visit to New Delhi by Hugo Chávez,
the president of Venezuela - the first such trip by a Venezuelan leader - is seen as crucial for both countries. Steady economic
growth over the past decade has caused a sharp spike in India's energy requirements. As a result, Indian diplomats are looking
beyond the Middle East to diversify oil supplies. This quest for securing energy could reshape South Asia's geopolitical landscape
and affect India's diplomatic relations, particularly with the United States.
Already sixth in global petroleum demand,
India meets 70 percent of its needs through crude oil imports. By 2010, India should replace South Korea to emerge as the
world's fourth-largest energy consumer, after the United States, China and Japan.
As a result, the Indian government
is investing heavily to secure supplies from abroad. In addition to Russia, Latin America and the Middle East, Indian oil
companies are looking to Africa - Chad, Niger, Ghana and Congo in particular - for oil and gas fields. The thirst for energy
has also pushed India to adopt a more pragmatic approach with her close neighbors, collaborating in various ways not only
with China, but even Pakistan. After years of expressing reservations, policy makers in New Delhi have indicated their consideration
of a proposal for a pipeline from Iran to India, via Pakistan, which could bind the two rivals economically.
Indian
authorities have indicated that they are also not hesitant in seeking deals with pariah states. In Sudan, India has invested
$750 million for the 25 percent stake in the Greater Nile Oil Project previously held by Talisman Energy of Canada. Talisman
was forced to quit Sudan after it came under pressure from human rights organizations over the issue of Darfur. Closer to
home, India has reached an agreement with Myanmar's junta for the construction of a gas pipeline.
Forging alliances
with oil-producing countries comes with its own risks, since these states are often in conflict with the United States over
human rights or nonproliferation issues. Washington will probably tolerate India's alliances with nations like Sudan and Myanmar
- and with Chávez's Venezuela, which has bitter relations with the United States - as long they remain strictly trade-focused.
Anything further will invite U.S. displeasure and possibly strain relations between the two countries.
India's growing
ties with Iran, however, raise a number of interesting questions, given India's good relations with Israel and the United
States. Washington has in fact already expressed its displeasure at New Delhi's newfound friendship with the regime in Tehran.
Still, by far India's biggest success overseas has been in Iran, where in January the state-run Indian Oil Corp. reached an
agreement with the Iranian firm Petropars to develop a gas block in the gigantic South Pars gas field, home to the world's
largest reserves. India is cooperating with President Mohammad Khatami's government to secure Gulf sea lanes and formulate
a common Central Asian strategy. India is also helping Iran to develop its Chahbahar port, as well as several infrastructure
projects.
Indian policy makers tend to play down military relations with Iran, but New Delhi's strategic relations
with Tehran do have worrisome components for the United States. According to a recent report from the Center for Strategic
and International Studies, Iran sought India's help in developing submarine batteries that are more suitable for the warm
waters of the Gulf than those supplied by Russia. Washington and Tel Aviv are concerned about the power-projection capability
the submarines offer Iran.
On the nuclear issue, India is very careful to keep its distance from Iran for fear of upsetting
foreign- policy hawks in Washington, though it has claimed it has helped Tehran with generating nuclear energy. Israel is
also keeping a cautious eye on this budding relationship and will probably remain quiet - as long as the connection does not
become overtly military in nature.
The growing economic ties between India and Iran are moving in the opposite direction
from Washington's continuing efforts to isolate the Tehran regime. India and the United State have already agreed to identify
ways to cooperate in preventing the further spread of nuclear technology. But signing long-term deals with Iran would make
it hard for India to oppose Iran if the matter came up to the United Nations for sanction.
India's long-term strategic
interest is better served by maintaining and improving upon its good relations with the United States, which will be a crucial
source of capital and technology and a potential ally should relations with China turn sour. These requirements will force
Indian diplomats to carefully craft these nascent oil alliances and resist providing any military support.
(Pramit
Mitra is a research associate with the Center for Strategic and International Studies in Washington. This article is adapted
with permission from YaleGlobal Online (
http://yaleglobal.yale.edu).)
Copyright © 2005 The International Herald Tribune
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