Page 54 - IACC Newsletter March 2013 Issue no. 9

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Indian Ambassador to the U.S. Ms. Nirupama Rao.
Despite the global economic slowdown, India's economy has grown at a relatively brisk pace over the past five years and
India is now the world's fifth-largest energy consumer. It imports 75% of its energy (especially oil and petroleum
products) today and expects to import 90% over the next decade. As a result, India is working hard to diversify its energy
supplies. Still, the demand for energy keeps growing at a rate of 5%-6% annually. My country needs to secure more
supplies to foster the socio-economic development of millions of our people who are still living in poverty.
Happily, the U.S. has experienced a boom in the production of natural gas. The ability to tap large formations by
advanced technologies has yielded a large amount of this energy resource that achieves significant savings compared
with diesel, especially when used in high-mileage heavy-duty vehicles. Liquefied natural gas is transported more easily
than other forms of energy. Significant investments, including some from India, have been made in technologies
designed to harness LNG safely and efficiently and to build new facilities and ports to distribute it globally.
There is a significant potential for U.S. exports of LNG to grow exponentially. So far, however, while all terminals in the
U.S. with capacity to export LNG are authorized to ship it to countries with which the U.S. has a free-trade agreement,
only one—the terminal at Sabine Pass in Louisiana—has received authorization to export to non-FTA countries.
Authorization for other terminals to export LNG to those countries is currently awaiting a review by Department of
Energy. As part of its own due diligence, the department commissioned a report on the domestic economic impact of
increased LNG exports. The study analyzed more than 60 different macroeconomic scenarios, and under every one of
them the U.S. economy would experience a net benefit if LNG exports were increased.
A boost in LNG exports would have many positive effects on both the U.S. and Indian economies. For the U.S. it would
help create thousands of jobs and an expanded revenue stream for the federal government. For India, it would provide a
steady, reliable supply of clean energy that will help reduce our crude oil imports from the Middle East and provide
reliable energy to a greater share of our population. For both countries, which are committed to environmental
sustainability, increasing the use and transport of LNG globally will help put into greater use one of the cleanest energy
sources in the world.
The prospect of increased Indian investment in the U.S. natural-gas market will usher in a new era for a strong and
mutually rewarding India-U.S. energy partnership. Through it, we will further consolidate our strategic ties and deepen
cooperation for the benefit of millions of people in both countries.
US should incentivize India to open economy: US expert
Saying that strengthening Indo-US trade ties makes abundant economic sense, a US expert says the US can help India's
growth by incentivizing New Delhi to open up its economy. "Within a generation, India will likely become one of United
States' most vital diplomatic partners," said Daniel Twining, senior fellow for Asia at the German Marshall Fund of the
United States in an opinion piece in the Wall Street Journal.
"As the US pivots toward Asia, India will prove more capable than any existing US ally in advancing interests from
defeating terrorism to managing China's rise," he wrote noting "Already, Washington and New Delhi have developed a
far-reaching strategic partnership centered on defense cooperation."
"In contrast, Indo-US economic relations remain underdeveloped, stymied by a lack of vision and Indian skittishness
toward liberalization," Twining said suggesting, "A new trade and energy partnership could make up for lost time."
"To cement its burgeoning alliance with New Delhi, and to help India reform and grow, the US should offer the triple
incentive of a free-trade agreement, assured energy supplies and membership in the Asia-Pacific Economic Cooperation
forum (APEC)," he said.