India-Russia energy cooperation

Syllabus: General Studies Paper 2

Context:

Recently, at the 6th Eastern Economic Forum (EEF) in Russia’s Vladivostok, the Indian Prime Minister said that India-Russia energy partnership can help bring stability to the global energy market.

• Indian and Russian Energy Ministers announced that the countries’ companies have been pushing for greater cooperation in the oil and gas sector beyond the U.S.$32 billion already invested in joint projects.
• India’s Minister for Petroleum and Natural Gas referred to Russia as the largest investor in India’s energy sector.

Significance of India-Russia energy cooperation

• Act Far East Policy: Earlier, the Prime Minister of India has also launched India’s ‘Act Far East’ policy, aiming to tap resources potential in the region and find opportunities for employment and development in the region.
  • India and Russia, also agreed for a sea linkbetween Vladivostok, the capital of Russian Far East and Chennai. It will help in tying up with the Indo-Pacific concept and opens up possibilities for India to connect with northern Europe using an Arctic Route.
• Renewable, nuclear energy: In efforts to transition to green energy, India has recently achieved a significant milestone of completing the countrywide installation of 100 gigawatts of total installed renewable energy capacity, excluding large hydro.
  • It now aims to hit 175 GW of renewable energy targets by December 2022. If achieved, that would be close to half of India’s current total installed power capacity.
  • However, unknowns of climate change and threats of a new pandemic suggest that the country should accelerate its energy transition.
  • Russia, one of the key global playersacross the energy market, could emerge as an indispensable partner for such a transition.
  • Russian companies have been involved in the construction ofsix nuclear reactors in the Kudankulam nuclear power project at Tamil Nadu.
  • Furthermore, India and Russia can securethe potential of designing a nuclear reactor specifically for developing countries, which is a promising area of cooperation.
  • India’s nuclear power generation capacity of 6,780 MW may increase to 22,480 MW by 2031, contributing to the country’s efforts to turn to green energy.
  • One of the examples of cooperation between the two countries in energy transformation is the joint venture between India’s Reliance Industries Ltd. and Russia’s Sibur, the country’s largest petrochemicals producer.
• Overcoming supply chain risk: The technology transfer is bringing to India unique technology, which is not commercially available in the market and the most advanced in terms of an ecological footprint.
  • The project will tremendously support the growth of India’s auto industry by securing uninterrupted critical raw material supply.
  • This is of particular importance in the current pandemic, multiplying the risks of global supply chains disturbance.
  • The project is a clear manifestation of the “Make in India” and “AtmaNirbhar Bharat” initiatives, representing a practical example of technology transfer from Russia to India.
• Boost to refinery sector: India is one of the fastest-growing markets for butyl rubber and halogenated butyl rubber due to its rapidly expanding car manufacturing industry pushing for electric vehicles.
  • Further to this, India is emerging as a critical refining hub in Asia to boost its petrochemical capacity.
  • Over the past years, India’s refineries have been expanding towards petrochemicals to capture additional value. It was noted by the International Energy Agency in the India Energy Outlook 2021

However, the current bilateral exchange rate needs to accelerate for India to grasp its potential from energy transformation.Despite significant progress, coal remains India’s most important source of electricity production, and it does not spell good news for the environment. To meet its growing energy demand and succeed in green transformation, India needs approximately U.S.$500 billion of investments in wind and solar infrastructure, grid expansion, and storage to reach the 450 GW capacity target by 2030. Therefore, more efforts are needed to expand cooperation with such partners as Russia.

The Hindu Link:

https://www.thehindu.com/opinion/op-ed/energy-cooperation-as-the-backbone-of-india-russia-ties/article37200740.ece

Question- India-Russia ties are necessary for India’s energy security. Elucidate.