Fuel for thought

• A decade ago, three Indian companies — Reliance Industries Ltd. (RIL), Oil and Natural Gas Corporation (ONGC) and Gujarat State Petroleum Corporation (GSPC) — independently announced substantial gas discoveries in the Krishna-Godavari Basin in the Bay of Bengal.
• For a fuel-starved country, these discoveries were harbingers of hope and optimism.
• While crude imports would continue, we believed we could finally turn our back on polluting coal and transit to natural gas-based electricity generation.
• In fact, in Andhra Pradesh, four CCGT-based (combined cycle gas turbine) thermal generation plants came up in the wake of the announcement.
• Abundant domestic gas supplies also meant enhanced food security, since gas is the main feedstock for manufacturing fertilizers.
• India is surrounded by gas-rich neighbours — Turkmenistan, Afghanistan, Bangladesh and Myanmar. Yet, cross-border gas pipelines have eluded us till now.
• While the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline is said to be at a reasonably advanced stage of negotiation, its prospects are dogged by so many problems that until that pipeline actually materialises and the gas starts flowing, it would be premature to count on it.
• In the event, India’s hope of meeting burgeoning gas demand is only through import of natural gas in the form of LNG (liquefied natural gas).
• LNG is an excellent option for countries that cannot access piped gas.
• Even Europe, which is extravagantly served by gas pipelines from Russia, has built several LNG terminals to supplement Russian supplies.
• LNG requires substantial infrastructure, both at the dispatching and receiving ends.
• LNG is natural gas cooled at source to minus 161 degrees Celsius converting it into liquid form and shipped in cryogenic ships.
• The importing country needs cryogenic storage facilities as well as re-gasification terminals where LNG can be converted once again into gaseous form and sent through the domestic pipeline network.
• Setting up LNG terminals is a capital-intensive operation.
• India already has two operational LNG terminals on the Gujarat coast, and a third one in Kochi.
• More LNG capacities are being planned along our long coastline. With domestic gas production plummeting to record lows, some of these will get built in the next few years.
• LNG export prices to European destinations have been driven down by the shale glut in the U.S. However, Asian LNG prices tend to be aligned to the prices Japan is willing to pay for its LNG imports.
• Japan’s electricity generation is almost entirely LNG-based, and its desperation to keep the lights on has led to substantially higher prices for LNG in the Asia Pacific region.

• secrecy shrouds the price at which LNG is contracted by importing countries, including India. the future of LNG in India will critically depend upon a far-sighted proactive approach that ensures transparency, fairness and certainty for all stakeholders, most of all, for the beleaguered Indian gas consumer.

Losing the plot in the neighbourhood

• Bangladesh, for example. Finally, the Bill to ratify the Land Boundary Agreement (LBA) was introduced in the Rajya Sabha last week — but had to be deferred again, because of opposition by the Bharatiya Janata Party — nearly two years after it was signed by Dr. Singh and Bangladesh Prime Minister Sheikh Hasina in Dhaka. Having failed to call Trinamool leader Mamata Banerjee’s bluff on the Teesta waters agreement, the Prime Minister hid behind the compulsions of coalition-building and failed to explain to senior BJP leaders early enough the importance of ratifying the LBA by the necessary two-thirds majority in Parliament.

Partisan politics

• The meeting between the PM and the BJP came only a few days ago, far too late for any serious bargaining.

• With the government’s credibility falling by the day, the BJP, which hopes to win back power in 2014, failed to put national interest above partisan politics and strung Dr. Singh along. It insisted that Delhi first takes on board the views of States neighbouring Bangladesh — knowing, very well, that West Bengal would refuse to toe the line — and then put up the lone Asom Gana Parishad MP, Birendra Prsad Baishya, to opposing the Bill in the Rajya Sabha and bringing the House to a standstill.

• If Delhi has been sleeping over Bangladesh, it’s over-activism in Bhutan has been puzzling.
• After its Prime Minister met the Chinese Premier in Rio de Janeiro last year, the Indians did a double-take.
• In Delhi’s black-and-white view of the world, how could a friend so openly consort with the enemy? But India forgot that South Asian realpolitik was not a Harry Potter movie and that China was not Voldemort; if anything, Delhi was reaching out to Beijing on several counts on its own steam. India’s decision to raise energy prices, passed off as a budgetary cut, caused a storm in Bhutan.

• Observers have wondered about the remarkable lack of grace in dealing with Bhutan and asked if the division of power between the Prime Minister’s Office and the Ministry of External Affairs was the root of the problem.

• During Atal Behari Vajpayee’s tenure, then Foreign Minister Jaswant Singh and then National Security Adviser Brajesh Mishra had vied to be the most influential. The questions, whether there is a similar contest in the Manmohan Singh government and if so, who are its main protagonists, continue to loom large behind the scenes.

• With Pakistan, of course, much has been written and said since the August 6 incidents on the Line of Control, when five Indian soldiers were killed by Pakistanis.

• The irony here is unmistakable: In the early days of the Kargil war, Pakistani soldiers from the Northern Light Infantry wore civilian clothing to sneak into India. In 2013, Pakistani citizens — soldiers, specialist troops or militants in army uniform — needed to wear official army dress to signal the seriousness of their intent to destabilise India.

Sources: Various News Papers & PIB