According to reports, India will have to meet half of its energy requirements through imports by 2030 as the demand is expected to cross 1,500 million tonne of oil equivalent (mtoe).
Today, India consumes 700 mtoe of energy in different form and imports one third of the same. Demand for oil and natural gas alone is expected to be tripled in next about two decades to make India one of the most import dependent nations in the world, projects McKinsey & Company.
“In view of the rising demands for energy, India dependence on imports will grow faster than its demands. Today, countries like Japan and Germany have much more dependence on imported energy resources compared to India in percentage terms. But unlike India they don’t only have greater affordability but also very little population,” said McKinsey India director Vipul Tuli.
On Monday, petroleum secretary Vivek Rae expressed concerns over rising burden of oil import while scholar Daniel Yergin called it a ‘quiet crisis’ for India.
McKinsey Hong Kong director Paul Sheng who is in India to launch report ‘India: Towards Energy Independence 2030’ at Petrotech said,” World energy sector is very diverse and policy makers will have to put every piece together to understand the market realities better in the changing times. India can reduce its import dependence by 15-20 per cent by 2030. It will have to introduce appropriate policies to explore domestic resources and offer viable market to the investors”.
McKinsey suggested three approaches to help India’s energy import dependence by increasing supply, reducing demand and securing imports. It suggested India to increase its coal production, unlock unconventional gas potential, support oil and conventional gas and promote renewable energy. McKinsey stressed on the need to create an India-Middle East energy corridor and establish gas positions in North America and East Africa.
It also suggested aggressive drive to bring in energy efficiency. In 2010, coal accounted for 41 per cent, liquids for 24 per cent, non-commercial fuel for 23% and natural gas for 8 per cent. Hydro, wind and nuclear power accounted for the balance share while coal, oil and natural gas accounted for 73 per cent. Large energy consumer like US will have negligible import of energy while 20 per cent Chinese energy demands will be met through imports, which is about 10 per cent today.