Big Picture, GS-2, International Relations, Uncategorized

Indo-US Strategic Ties: Where Is It Heading?

The relationship between India and USA which has been on an upward curve for some time is further seeing an upward trend. The crucial LEMOA (Logistics Exchange Memorandum of Agreement) recently signed by both the countries is a significant step towards strategic and defence ties.

What does the Agreement mean?

  1. It provides for automatic approvals process in place to militaries of both the nations to share each other’s bases for various operations. It establishes basic terms, conditions, and procedures for reciprocal provision of logistic support, supplies, and services.
  2. It covers logistics supplies during disaster relief efforts, joint exercises, port visits, joint training and humanitarian assistance along with other uses to be discussed on a case by case basis.
  3. The agreement does not create any obligation on either party to carry out any joint activity compulsorily and also does not provide for any basing arrangements.

Analysis:

The agreement is a strategic binding between India and the US. This is the final lap for Obama administration not only with respect to India but also with other countries. This is the time when Obama’s legacy is being finally summed up. From USA’s point of view this agreement is a tremendous success which was held back for several years.

By signing this agreement India does not agree to provide basing rights to USA or being a military ally to it. As per the agreement, it only facilitates the Indian military to fulfill its basic logistic requirements such as food, water, transportation, petroleum, oils, lubricants, clothing, communication services, medical services, storage services, training services, spare parts and components, repair and maintenance services, calibration services and vice versa. Since America is already a strong military power, at present India seems to have an edge as this agreement gives an enabling framework and will enhance its sustainability in different areas of humanitarian work.

This agreement has taken more than 14 years to be signed. America has put India as a defence partner and not an ally. It wants India to be a rising power and this is in interest of both the countries. In 2003 during Iraq war, India had provided logistic facilities to the US ships for refueling. Ships were escorted through the Malacca Strait. The agreement is more than logistics supplies and has to be looked in terms of trade, defence and technological initiative. For example: DTTI (Defence Technology and Trade Initiative) aims to strengthen India US cooperative research, co-production, and co-development of capabilities which are required for modernization of our military forces and for this US has set up an Arms Act as well specifically for India. An India Rapid Reaction Cell has been set up in Pentagon as well to speed up defence ties.

The key point is access to bases today and if India gets access to the US bases in South China Sea, South East Asia or Asia Pacific, then it would be a major plus point. India holds more joint military exercises with US than any other nation in the world. These exercises will become much easier to conduct.

Geostrategic Importance:

This is a kind of litmus test from America’s point of view. India has taken a leap of faith and has come much closer to US in strategic and geopolitical terms. While having its own strategic autonomy, India has identified itself with US strategies as well in a harmonious manner. However, this is a foundation agreement and there are many other agreements which are major ones yet to be signed. China may or may not be much concerned about this agreement because it already has it owns bases in Djibouti and access to Pakistani ports. So, China can take care of its requirements. If such agreements are signed by India, it cannot stop Sri Lanka in future to sign any pact with Chinese. The aim is basically to have a containment strategy against China. Russia has got access to our region through Iranian ports very recently. So, India has taken correct steps in its interest and there is no alternative to it.

Conclusion:

The non alignment era has ended now and this is the time for multi alignment. India has maintained good relations with Japan, US, China, Russia and other countries while talking of strategic autonomy. Indo-US relationship tends to work in bits and pieces as the role of US in South China Sea is still not clear and both countries have different views on Afghanistan. Now in the pretext of current events this diplomacy is something that needs to be maintained in future as well.

GS-2, International Relations, Uncategorized

India now a ‘major defence partner’

The Hindu

Issue

  • India-US relations.

Key points

  • US now considers India as its ‘major defence partner.’
  • This classification will allow India to buy more advanced and sensitive technologies from the U.S.
  • This move will be complemented by India’s entry into the Missile Technology Control Regime, an exclusive club that restricts trade in sensitive defence technologies.
  • US has also shown its support for India’s membership into Nuclear Suppliers Group (NSG).
  • According to a joint statement released by both the countries, India will receive licence-free access to a wide range of dual-use technologies.
  • However, there was difference of opinion between the countries over the time-frame of ratification of Paris Treaty by India.
  • US understands that India will ratify it by the end of this year.
  • Whereas Indian diplomats have hinted that India has not given any deadline for the ratification. It has said, that it will ratify it ‘as soon as possible’.
GS-2, International Relations, Uncategorized

India, US and an eastward tilt

Indian Express

Issue

  • India-US foreign Policy

Context

  • Author has raised a question that, Why does India-US military cooperation not include northern Arabian Sea and Persian Gulf — a region of great importance for India’s security?

Background

  • The US is pressing India to sign a number of what it calls “foundational agreements” to operationalise India’s military commitments implicit in the Joint Strategic Vision for Asia-Pacific and the Indian Ocean arrived at during President Barack Obama’s visit to New Delhi in January 2015.

US has ignored India in the  Arabian sea and the Persian Gulf

  • India is dealt with in the US politico-military system by the Pacific Command, headquartered in Hawaii, and whose responsibilities extend up to Diego Garcia.
  • The Central Command, headquartered in Florida, “looks after” the Persian Gulf, Central Asia, Afghanistan and Pakistan.
  • Technically speaking , the Joint Strategic Vision should cover northern Arabian Sea and the Persian Gulf.
  • But US has shown lukewarm approach to an Indian connection in Afghanistan or, for that matter, the Persian Gulf and the Saudi peninsula.
  • Whereas it has shown eagerness for Indian participation in action in the South China Sea.

Importance of  northern Arabian Sea and the Persian Gulf for India

  • Both from the geo-economic and geo-strategic view, this is the most important external region for India’s security.
  • We source 70 per cent of our oil from there, and 7 million Indian citizens working there send back $30 billion in remittances.
  • As our energy needs increase, this area will only become more important.
  • In the past, we have had to carry out large-scale evacuations of our nationals because of war-like situations in this region, most recently from Yemen in 2015. The prognosis for the stability of the whole region is not particularly good.
  • Yet, somehow, there are no drills, joint exercises or planning between the US, which is the dominant power, with a fleet headquartered in Bahrain, and India for conflict contingencies.
  • India should  keep national interest firmly in mind.

Where do we need US?

  • Given the rapid rise of China and our own considerable difficulties with Beijing, having the US as a security partner is useful.
  • But India does not really need the US for its existential security, certainly not from any direct threat from China.
  • India  needs the US as a guarantor of a secure and stable world system, but especially as a security provider in the Persian Gulf region, where we have no military capacity.
Editorials, GS-3, Indian Economy, Uncategorized

‘Make in India’ not at cost of IPR: US

The US Trade Representative’s annual Special 301 report, that identifies trade barriers to U.S. companies and products due to a foreign government’s intellectual property regime, has placed India on the Priority Watch List, the same as last year.

What is special 301 report?

Under Section 301 of US Trade Act, the office of US Trade representative (USTR) prepares a list of countries whose Intellectual property right regime (IPR) has negative impact on American products. Among such countries, special attention given to two groups:

Priority watch list countries Priority foreign countries
USA uses “carrot” policy to incentivize IPR reforms e.g. funding, training, capacity building, bilateral exchanges and conferences. “sticks” policy to force IPR reforms e.g. putting trade sanctions, approaching WTO dispute resolution.

Why is India kept in the Priority Watch list, in this report?

India is kept in Priority watchlist because

  • Report has raised multiple concerns, particularly related to the potential erosion in IP standards due to its push for promoting domestic manufacturing.
  • It  is concerned about actions and policies in India that appear to favour local manufacturing or Indian IPR owners.
  • According to the report,  India has not taken the opportunity to address long-standing and systemic deficiencies in its IPR regime and has endorsed problematic policies.
  • It said India was the source of a lot of pirated and counterfeit goods reaching the U.S shores.
  • It has asked for clarity from the Government of India regarding the compulsory license decision-making process, as it affects U.S. stakeholders.
  • India doesn’t have separate Anti-Camcording law to combat video piracy.
  • India doesn’t have special takedown procedures against piracy websites.
  • India is the top supplier of counterfeit pharmaceuticals to USA. Patent holder lose billions of dollar each year due to counterfeit / pirated products.
  • Thus, India’s IPR regime is not conductive for innovation by foreigners- at least in USTR’s interpretation, hence put under “Priority watch list” of Special 301 report

Compulsory Licencing

  • Compulsory licensing is when a government allows someone else to produce the patented product or process without the consent of the patent owner.
  • It is one of the flexibilities on patent protection included in the WTO’s agreement on intellectual property — the TRIPS (Trade-Related Aspects of Intellectual Property Rights) Agreement.
  • The compulsory licensing provision arms the government with the power to ensure that medicines are available to patients at affordable rates and has so far been used in Brazil, Thailand and South Africa.
  • It gives the government the right to allow a generic drugmaker to sell copycat versions of patented drugs under certain conditions, without the consent of the patent owner.
  • The TRIPS Agreement does not specifically list the reasons that might be used to justify compulsory licensing.
  • However, the Doha Declaration on TRIPS and Public Health confirms that countries are free to determine the grounds for granting compulsory licences.

Stand of the Indian Government

  • The government of India does not engage with the process as it considers it an infringement on the country’s sovereignty.
  • Indian official sources pointed out that the categorisation is arbitrary and mostly a political decision, in order to reward or punish a target country.

How does India fare with respect to its competitors?

China too is in Priority Watch List  whereas Pakistan is in Watch List,  as according to the report Pakistan  has shown sufficient improvement in IP protection and enforcement.

Editorials, GS-2, International Relations, Uncategorized

Raja-Mandala: Aligning with the far to balance the near

Issue
How India should calibrate its relationship with US and China

Expert Analysis

Policymakers in the foreign policy believe that expanding the military partnership with the United States might have huge negative consequences for Delhi’s engagement with Beijing. Thus they form US policy on the basis that, what China would think of it.

But the reality is otherwise. In Foreign Policy the nations have no permanent friends or allies but only permanent interests and every country calibrate its relationship with others with time. There are various instances when Chinese did that. Some of them are as follows:

  • If military cooperation with the US was the defining factor in China’s relations with other countries, Beijing should be utterly hostile to Islamabad. Instead they are all weather friends inspite of Pakistan being a longstanding military partner for the US.
  • In 1950 China signed military alliance with USSR  and a decade later China criticised Russia as a “social imperialist” and began to make advances to America. China, which denounced America’s military presence in Asia during the 1950s, was quite happy to justify it in the 1970s and 1980s as a useful counter to Soviet power.
  • Beijing mounts solid political pressure on Japan, America’s “unsinkable aircraft carrier”, while maintaining close economic relations.
  • China woos South Korea that hosts nearly 28,000 US troops on its soil. Beijing deploys a carrot and stick policy towards Vietnam that is getting closer to America.

For China, this is about careful tailoring of its policies to specific contexts and not judging everyone by their ties with Washington. Ironically Some Chinese analysts seems to have better appreciation of Delhi’s changing policies than India’s own strategic community. They think Delhi today is playing a sophisticated game like Mao’s China that “aligned with the far” (America) to “balance the near” (the Soviet Union).

Neither Delhi nor Beijing, then, are innocent to geopolitical jousting. In the end, America is by no means the main problem between India and China. That lies elsewhere in their contestation of each other’s sovereignties across the Himalayas — in Kashmir, Tibet and Arunachal Pradesh.

Delhi should focus instead on managing, if not resolving, the territorial issues and expanding economic partnership with Beijing. When India and China are not a political threat to each other and can make money from the markets of the other, they will have less reason to worry about their relations with third parties.

GS-2, International Relations, Uncategorized

India-US Logistics Support Agreement

India and the US have signed an in-principle agreement for sharing military logistics. The agreement will give two nations access to logistic support from each other besides refueling and birthing facilities. The US has also made it clear that if India wants transfer of high end technology, it needs to sign three foundational agreements. These agreements include:

  1. Logistic Support Agreement (LSA).
  2. Communications Inter-operability and Security Memorandum of Agreement (CISMOA).
  3. Basic Exchange and Cooperation Agreement for Geo-Spatial Cooperation (BECA).

Although the LSA agreement has been under negotiation for two decades now, the previous government was opposed to it. There was apprehension that the agreement would draw India into a de facto military alliance with the US. It should be noted here that this agreement does not involve giving away any bases. Also, India does not have any such agreements with other nations.

What is LSA all about?

Initially Logistics Support Agreement was called Access and Cross-Servicing Agreement (ACSA) but later it was renamed Logistics Support Agreement. The LSA would require both countries to provide their bases, fuel and other kinds of logistics support to each others’ fighter jets and naval warships. Logistical support with regard to weapons facilities would involve non-offensive military equipment. This support will involve cashless transactions on a reciprocal basis. The LSA would be particularly beneficial at the time of disaster relief operations like the one India undertook in the wake of the Asian Tsunami in 2004.

Why it was opposed?

  • There is an apprehension that this agreement would lead progressively towards a form of informal military alliance.
  • This has politically sensitivity involved in it too.
  • Some experts also believe that by signing this agreement India may become a party to the ‘wrong designs’ of the US military in the region and in the process, compromise India’s strategic sovereignty.

Benefits of this agreement:

  • Whenever the ships of other countries visit our ports or air bases, they go through a very long process of clearances through MEA, MoD and other agencies. This agreement aims at cutting short of these procedures.
  • The exchange of logistics support facilities would further enhance bilateral defence cooperation as well as India’s strategic role, keeping in view the projected expansion of the Indian Navy’s role beyond the Indian Ocean Region (IOR).
  • The absence of appropriate logistics support mechanism between the two countries would hamper such capabilities to effectively deal with the security challenges during emergency situations.
  • Financially too the LSA makes good sense for India. According to some official estimates, with LSA in place, India would be able to save around US$20 million per war game, when Indian forces take part in any of the joint military exercises with the US on American soil.

Things to be taken care of:

  • The logistics support should be limited to certain situations such as joint military exercises, interventions in disaster relief or any other situation mutually agreed upon.
  • It should be taken care that the degree of autonomy in deciding what situation the agreement will apply is not lost.
  • This agreement involves setting up of warehousing facilities in each other’s lands. It is worrying because such places have their own personnel guarding them.
  • India should also make sure that it retains the ability to say no to access to logistics under exceptional circumstances.

What about other two agreements?

  • CISMOA would allow US to provide India with its encrypted communications equipment and systems so that Indian and US higher commanders, aircraft and ships can communicate with each other through secure networks in peace and war.
  • BECA would provide India with topographical and aeronautical data and products which will aid navigation and targeting.
  • These are areas in which US is very advanced and agreement could definitely benefit India, although armed forces which use systems from many other countries like Israel and Russia are not comfortable with sharing information about their systems with US.

Conclusion:

The logistics support agreement is a mutually beneficial agreement. However, both sides need to make efforts to arrive at a consensus that is consistent with their national interests and policies. LSA should be limited to simplifying procedures. Also, the other agreements are not easy. They need larger consensus and greater discussions. The fundamental question is whether India possesses the political will to forge a closer relationship with the US, and at the same time have all its options open for any eventuality.

GS-3, Indian Economy, Uncategorized

Trading charges

Article Link

In February, 2016, U.S. President Barack Obama signed the Trade Facilitation and Trade Enforcement Act of 2015.

  • The focus of the law is to enhance enforcement of IPR over the U.S.’s trading partners. It introduces important measures relating to intellectual property rights (IPR) issues.
  • This law is expected to impact India’s ability to develop an IP policy suited to its own developmental needs.

Present scenario:

The Special 301 list, brought out by the United States Trade Representative (USTR), has consistently featured India, most often as a Priority Watch List (PWL) country, since its institution in 1989.

  • This has caused some disquiet within India, which has been disappointed that its proactive steps to improve domestic IP protection and engage with the U.S. have been unsuccessful in placating the U.S.

Why be concerned about this?

  • Countries featured on Special 301 list are those that the USTR believes have either national laws or regulations that detrimentally affect U.S. trade or the rights of IP holders.
  • If a trading partner is on this list, the U.S. believes that the country is providing inadequate IPR protection, enforcement, or market access for persons relying on intellectual property.
  • Also, any country classified as PWL is subject to USTR scrutiny in the form of investigations and possible sanctions under the procedures set out under the Trade Act, 1974.

How the new law further aggravates the existing problem?

Trade Facilitation Act will increase the level of pressure to comply with the USTR’s requirement for countries like India that feature on the PWL for more than a year.

  • The Act specifically requires the USTR to develop action plans with benchmarks for PWL countries. The USTR has traditionally developed action plans in consultation with the country in question. However, under Trade Facilitation Act, the USTR is not required to consult with the listed country.
  • Also, Benchmarks refers to legislative or other institutional action that a sovereign country like India will need to establish to facilitate U.S. trade. And instituting benchmarked changes remains the only way to remove a country from the Special 301 list no matter how harsh they are. Since the role of USTR is focussed on U.S. trade, it is not obliged to take developmental or public health needs of the trading partner into account when developing action plans or listing benchmarks.
  • A country that refuses to comply with the benchmarks within a year can face appropriate action, resulting in further unilateral investigations followed by punitive trade sanctions. Such trade sanctions can include denial of preferential duty for exports, which developing countries rely on to export goods to the U.S.
  • The Act creates a new position within the office of the USTR titled ‘Chief Innovation and Intellectual Property Negotiator’ (IP negotiator). The IP negotiator is required to “take appropriate actions to address acts, policies, and practices of foreign governments that have a significant adverse impact on the value of U.S. innovation.”
  • Also, with a view to facilitating unilateral actions, the Act creates a Trade Enforcement Trust Fund for legal actions against foreign countries to ensure “fair and equitable market access for U.S. persons.”

Is it not possible to seek any help from the WTO?

Under World Trade Organisation jurisprudence, legality of unilateral actions over sovereign countries remains questionable. Hence, the U.S. may stay away from imposing unilateral sanctions, but tries to bring about change in a country’s domestic IP law through mechanisms like the Special 301 list.

Thus, under U.S. laws, compliance with WTO obligations is immaterial. A country that is compliant with WTO rules can be the subject of investigations if the USTR believes that U.S. trade is detrimentally affected by that country’s IP laws. Thus, India’s traditional defence that it is in compliance with WTO obligations has limited reach.

Conclusion:

India should be concerned about the heightened pressure that is bound to follow with the passage of the Trade Facilitation Act, especially on issues where its compliance with its TRIPS obligations is not disputed. As India continues to strategically engage with the U.S., it is time to develop a coalition of like-minded countries to monitor demands for legislative actions that result in WTO-plus standards.

GS-2, International Relations, Uncategorized

What are LSA, CISMOA and BECA agreements?

Scope of discussion

  • What do we mean by LSA, CISMOA & BECA – Back2basics terms
  • Why the US wants India to sign them? Mains & Interview
  • Why was India averse to signing these pacts? Mains
  • What is Defense Technology and Trade Initiative (DTTI)? Prelims & Mains

What are LSA, CISMOA and BECA agreements?

Welcome to the world of 3 foundational agreements that the US has been insisting on India to sign to further enhance the bilateral defence and strategic relationship.

#1. The Logistics Support Agreement (LSA)

  • LSA would set a framework for the two countries to share military logistics
  • To assist each other’s armed forces with simple military logistics. For the U.S. Navy, for example, logistics support from India would be a valuable asset, helping it better project power in the Indian Ocean.

LSA would allow each other to access their military bases without any conflict for e.g in 1991 Gulf war India denied the US from refueling its aircraft from Indian territory.

#2. The Communication and Information Security Memorandum of Agreement (CISMOA)

  • CISMOA would allow the United States to supply India with its propriety encrypted communications equipment and systems
  • Thus allowing secure peacetime and wartime communication between high-level military leaders on both sides
  • CISMOA would extend this capability to Indian and U.S. military assets, including aircraft and ships

#3. The Basic Exchange and Cooperation Agreement (BECA)

  • BECA would set a framework through which the United States could share sensitive data to aid targeting and navigation with India

 

Why the US wants India to sign them?

  • The agreements clearly puts emphasis on building interoperability and capacity of the emerging partners through joint military exercises, training, and defence equipment sales
  • US increasingly expects India to play the larger role of a “net security provider”
  • It believes that these foundational agreements will facilitate a strong defence and strategic partnership between the two countries

During the United Progressive Alliance (UPA) Government, India was less inclined towards signing these agreements BUT the India-US defence and strategic relationship has dramatically improved since the Narendra Modi Government came to power in May 2014.

Really? How so?

  1. India & USA agreed to transform from mere buyer-seller defence relationship to joint research, co-development and production of high end defence equipments
  2. Signed a “Joint Strategic Vision for the Asia-Pacific and Indian Ocean Region”. Again, this would be a good time to revisit our updated maritime strategy where we increased our ambit of surveillance because we want to be a“net security provider” in Indo-pacific. Click to read here.

 

If that is the case, why was India averse to signing these agreements before?

  1. India was concerned that it might erode its military independence
  2. Botch up its historically close security relationship with Russia, jeopardizing ongoing projects
  3. May antagonize China, leaving India in a disadvantageous position vis-a-vis its border disputes with Beijing. China’s visualization of US activity with any South Asian nation as its ‘Asia Pivot’ Strategy!
  4. In the case of CISMOA, it might allow the United States undue insight into Indian operational practices

Question

  1. These look like valid reasons for not signing the agreements. And anyway, we were going on with our weapons procurement business with US with/ without these. What changed then? Why has India given an in-principle nod to signing the LSA?

Hint:

The India-US statement came on a day when China expressed anger at the Group of Seven (G7) advanced economies opposing “any intimidating coercive or provocative unilateral actions that could alter the status quo and increase tensions” in the East and South China Seas.


 

Know more about Defence Technology and Trade Initiative (DTTI)

  1. Indo-Us defence pact, unveiled in 2012 – 4 major area of focus – Cooperation in (research, co-production , S&T and Military sales).
  2. It is mere framework not a treaty or law & disagreements have led to no progress since 2012!
  3. US prioritization of trade issues & India’s focus on technology transfers = Deadlock!
  4. Challenges and concerns = Terrorism from AF-PAK region, China’s assertiveness over South China sea.

 

 

 

Want to read more?

The debate on the value of these agreements for India is worth a read. Pratap Bhanu Mehta and Bharat Karnad lean against these agreements; Dhruva Jaishankar offers a case in favor.

Big Picture, GS-2, International Relations, Uncategorized

India US defence cooperation and Make in India Initiative

US defence secretary Aston Carter visited India last week  and discussed ways of enhancing previous  defence initiatives,and  signed new agreements like logistical exchange of memorandum of agreement which  entails the militaries of two nations to share facilities for refuelling, supplies and spares. Various agreements which also promote Make in India initiative were also proposed.

Make in India initiative which aims to transform  India in to a manufacturing hub has identified sectors which needs to be promoted. Defence is one among them. Efforts have been made  on this front through earlier initiatives with US like DTTI  ( Defence technology transfer initiatives) etc. But nothing seem to have taken off the board. There needs to have clarity on this front as to what exactly India wants from such initiatives.

Delay in expediting the initiatives which are already taken is another issue which needs close coordination. We need a focused  approach and consistent follow up action which helps to keep the various initiatives intact. In this aspect US has more role to play than India, who’s procedures are much simpler than US.

India invested nearly 14 billion dollars in last few years as part of is defence procurements, most of which is imported. With new scheme like Make in India we  need  to relook about establishing close synergies among the private players and defence manufacturers who engage in defence production on either side. This is a serious challenge which should not be ignored.

Also India’s  defence manufacturing capabilities need to leap frog from what where we are  right now. Initiatives like DTTI simply manifest the fact that india does not have the kind of technology that it requires. However on a long run efforts should be made to ramp up R and D and improve the situation on this front.

The discourse of india’s defence story should move from Defence co production to production and codevelopment to development. Every possible effort should be made to make  India self reliant. . What is necessary  is a more focused policy on defence issues and efforts to  make a realistic progress on this front. However India should also have all the technology at its disposal in difficult times by what so ever means at the same time it should never be complacent about collaborating on strategic issue like defence.

Editorials, GS-2, International Relations, Uncategorized

Four corners of a good deal

Article Link

The U.S.-Japan-India trilateral has gained momentum in recent years, with regular meetings and a variety of collective exercises. This proves that India has begun to exert its leadership in the Asia-Pacific region.

  • But, it is not possible for India to be a world leader or an Asian leader without first being a South Asian leader. For this to happen, the support of Australia is also necessary.
  • Few experts have been pitching for a greater cooperation between the U.S., India, Japan, and Australia. But, often this quadrilateral relationship is depicted only in defence terms. The four-way arrangement has made much less progress and has largely been limited to some meetings and naval exercises several years back.
  • But, a closer relationship between these four key democracies is necessary for India’s overall growth and can also boost India’s tenuous energy security in a big way.

India’s energy dependency:

India’s energy deficiency and ever increasing needs are well-known. It is also true that for Indian economic growth to return to double digits, energy supplies must increase by three to four times over the next few decades.

  • Deficits, however, are immense — including, for electricity alone, peak demand deficits of 25% in some southern States. This has made India largely depend on other countries to meet its demands.

Key facts:

  • 80% of India’s oil is imported.
  • Coal imports have also increased by as much as 56% in a single year.
  • India also imports 40% of its uranium.
  • Import of natural gas is also increasing.

Concerns:

India’s dependency on other countries is always fraught with risk.

  • Many, if not most, of its hydrocarbon imports come from unstable or faraway regions.
  • Two thirds of its oil comes from West Asia, and distant Venezuela is also a key source of oil. Additionally, India sees great potential in gas-rich Central Asia. However, because Pakistan denies India transit rights to Afghanistan, India lacks direct access to the region.
  • India is now planning to enhance its access to Central Asia by developing the Chabahar port in southern Iran. However, so long as Afghanistan remains unstable, access to Central Asia via Chabahar will be difficult.
  • TAPI pipeline project is a good move. But, Afghanistan’s security problems make this gas pipeline an unlikely prospect.
  • Meanwhile, the lifting of sanctions on Iran following its nuclear deal with the U.S. opens up energy possibilities for India, which has reduced its imports from Iran in recent years. However, New Delhi faces serious competition from other importers rushing to cash in.
  • India has also lost out many opportunities in this sector, while China has seized them.

How can Australia be a game-changer?

Australia can provide immense energy benefits to India. It already provides sizeable quantities of coal and uranium cooperation between the two countries has also been explored.

  • Australia is a top global producer of LNG. And in recent times, India has shown a strong desire to capitalise on Australia’s gas riches. With LNG prices having fallen by 75% since 2014, the timing could not be more ripe to explore deeper energy cooperation — particularly given the volatile location of Qatar, the top current source of India’s LNG imports.
  • Additionally, India could leverage a closer relationship with Australia to engage more deeply with the latter’s neighbour, Indonesia, which provides India more than 60% of its current coal imports. This would also help advance India’s “Act East” policy.
  • A closer relationship with Australia and Indonesia would further ease the burden on India’s naval forces of protecting energy assets in areas more far-flung than Southeast Asia.
  • Additionally, Indonesia and Australia — despite their proximity to the South China Sea and their susceptibility to Islamist militancy, including attacks by the Islamic State — are far more stable than West Asia, which would ease concerns about the security of Indian energy assets and imports originating in these two countries.

Way ahead:

The time is ripe for India to explore ways to increase cooperation with Australia. One way to achieve this is by reviving the quadrilateral relationship. This could also enhance energy engagement with the U.S. and Japan.

  • Besides, all four countries have an interest in energy infrastructure development. Japan, US and Australia have all signed on to the India-led International Solar Alliance. Japan and India are also offtakers for U.S. LNG projects.

Conclusion:

In recent years, a major roadblock to the quadrilateral relationship was Australia, which withdrew from the arrangement in 2013, citing concerns about China’s reaction. But, now with the new government the country has expressed renewed support for resurrecting it. For India, reviving the quadrilateral relationship may not make much sense from a national security perspective. However, viewed through the lens of energy security, it arguably makes very good sense.