New Delhi: The global energy landscape is fast changing to reflect the new reality, ranging from the US becoming an energy exporter to the West Asian economies turning into major energy consumers, and China moving towards clean energy.
India is moving to the centre stage of global energy affairs, and the International Energy Agency (IEA) is keen that the world’s third-largest energy consumer becomes its full-time member, making the body stronger and more representative, Fatih Birol, IEA executive director, said in an interview. Birol also said that while significant oil price increase poses a risk to India’s economic growth, it doesn’t bode well for the producers either, as it will create a space for oil alternatives.
How have changes in the global energy scenario impacted geopolitics?
Energy policy in many a case is linked to foreign policy and in some cases defence policy. We have seen major changes in the big countries’ positions.
The IEA has been keen that India becomes a member of the world’s premier energy monitor. What’s the status?
There has been huge progress. We have now made India as part of the IEA family as an associate member and we are working with all the ministries here.
When does India become a full member?
It is our aim. We are working with different IEA member governments and the Indian government and we are hoping that India in the future becomes a full member of the IEA. And when I look at the Indian energy sector, India’s economic growth and the Indian interest in the IEA, I see that there will be mutual benefits for everybody. We are trying to make this happen in the future. This is still under discussion and we are working on that.
Once India becomes a part of IEA, wouldn’t it give you enormous amount of heft?
Definitely. India with 1.3 billion people, with its economy being one of the bright spots of global economy, and an energy market flourishing here, will make IEA much more representative and much more stronger.
While India today called for responsible pricing, Saudi Arabia defended the cuts. Your views?
Of course, for everybody the price of oil is important but we believe that the price of oil should be determined by the market forces. I have to be very frank. For countries like India with growing oil and gas imports, there is also a growing vulnerability due to the oil price movements. So, if the prices increase significantly from the current levels, it may be definitely not good news for India and it may even be a slowing down factor for Indian economic growth.
But I believe, it is also not in the interest of major oil producers that the prices sky rocket, because alternatives to oil will come in the picture. Therefore all the consumers and the importing countries are very lucky that US shale oil is there. Because if the price of oil goes up, more and more shale will come to the market and put downward pressure on the prices.
We see the Saudi Aramcos and Rosnefts of the world coming here. Is it a more of a move to secure a market for one’s products?
Many companies and many governments want to be a part of India’s great success story. And, of course it is not only to help India but also want to do business in India. This shows that India is on the right way and India is becoming more and more important as the centre of attraction for investments.