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Connect Central Asia Policy: Ensuring Energy Security

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India initiated ‘Connect Central Asia’ Policy (CCAP) in 2012 which is based on pro-active political, economic and people-to- people engagement with Central Asian countries, both individually and collectively. India’s ‘Connect Central Asia’ policy has gained momentum since the visit of former External Affairs Minister S.M. Krishna to Kyrgyzstan in 2012.

The CCAP encompasses strategic and security cooperation and stepping up multilateral engagement with Central Asian partners using the synergy of joint efforts through existing fora like the SCO, Eurasian Economic Community (EEC) and the Custom Union. India looks to Central Asia as a long term partner in energy and natural resources. Central Asia possesses large cultivable tracts of land and potential for India to cooperate in production of profitable crops with value addition. CCAP emphasizes on cooperation in fields of medicine, higher education, tele-education and tele-medicine connectivity, construction sector, banking infrastructure, e-networks, and land connectivity.

India has close proximity with the Central Asian, West Asian and Persian Gulf countries and these geopolitical and geostrategic settings have an enormous role to play not only in undermining the Chinese designs to encircle India but also to ensure energy security to India. India was among the first countries to recognize the five Central Asian states and establish diplomatic relations with them. The emerging markets of the Central Asian Republics (CARs) of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan, called the underbelly of Eurasia, constituents of the former Soviet Union, are left out by the Indian private sector even when this natural gas-endowed region has the potential to redefine the geopolitical calculus of global energy security. The four major gas-abundant countries of the region account for 7.62 per cent of global gas reserves. This is excluding Russia, which has 24.94 per cent of the world’s gas reserves. These five countries are the northern frontier of the Islamic world. For long they remained unaffected by radicalism of any disturbing proportion. In fact, Central Asia is one of the most prosperous and fastest growing regions in the world and it is a key source for uranium and fertilisers. Undoubtedly, India has deep strategic and economic interests in Central Asia. Central Asia has been the centre of what is termed as the ‘new great game’ and India wants to be an active player in the region, given its uranium, oil and gas and mineral resources.

On the other hand, in 2013, India was the fourth-largest consumer and net importer of crude oil and petroleum products in the world after the United States, China, and Japan. According to data from the Ministry of Statistics and Programme Implementation (MOSPI), India imported 189 million tonnes (mt) of crude oil in 2013-14; its total consumption during that year was 222 mt. It simply means that India met 85 per cent of its demand through imports which has a staggering increase from 76 per cent in 2005-06, when India had imported 99 mt crude oil. But as per the data from the Ministry of Petroleum & Natural Gas, India’s “import dependence in the petroleum sector” in 2013-14 remained at 77.6 per cent, slightly higher than 76 per cent in 2011-12. At the domestic level, in 2013-14, India merely produced 38 mt crude oil – Oil and Natural Gas Corp (ONGC) produced 22 mt, Oil India Ltd (OIL) 3.4 mt and the others (private companies or joint ventures under the production sharing contract, or PSC, regime) 12 mt. Moreover, the ‘BP Energy Outlook 2035’, released in February, 2015, has indicated that India’s energy production rises 117 per cent by 2035, while consumption grows 128 per cent, adding oil imports will rise 161 per cent, even as a decline in oil production is offset by increased gas and coal output. A 2014 McKinsey study said India’s energy demand would grow from 691 million tonnes of oil equivalent (mtoe) in 2010 to 1,500 mtoe in 2030, based on GDP estimates.

Considering these imperatives and exigencies, India is bound to make its strong presence in the region. Central Asia’s abundant energy resources and India’s relentless energy needs, combined with India’s aspirations to be a major regional and global player, have been the key driving forces behind India’s growing presence in the region. Central Asia is also important as an avenue for access to Afghanistan, where India wants to be a significant player and to blunt Pakistan’s influence. India’s involvement in Central Asia includes energy ties, trade and investment, and the beginnings of a military relationship. In the West, the five countries of the area have become colloquially known as the “stans” because all of them bear the Persian suffix “-stan” meaning “land of or settlement.” Kazakhstan has substantial oil; Turkmenistan has gas; Uzbekistan has more modest hydrocarbon resources; and Kyrgyzstan and Tajikistan have surplus hydro power. Indian PM has realised the need to intensify diplomatic ties with Central Asian Republics and visited Turkmenistan, Tajikistan, Uzbekistan, Kyrgyztan, and Kazakhstan in July 2015, which was also timed around the BRICS and SCO summits held in the Russian city of Ufa from July 9 to 10, 2015.