In the last decade and more recently, China has taken giant strides in securing itself a lot of oil reserves especially in Africa. India on the other hand has been a laggard and has managed to do very little compared to Chinese achievements. Whenever India and China have competed for an energy resources, Chinese companies have gone on to win those. The Indian government has been slammed (for good reason) for not going out aggressively and securing reserves for India’s rapidly growing energy needs.
China obviously started much earlier than India, around 2003, after widespread electricity shortages started to cripple it’s economy. That was the time when Oil was touted to be the future and China felt that it had very few Oil fields and those too were declining in production. So it made sure that it bought equity stakes in oil fields in not much explored Africa, and aggressively moved to secure it’s oil routes.
Now is definitely different from then, two things specifically.
- Green house effects of oil and coal has made these very unpopular.
- Price of Oil has skyrocketed and become very volatile
The last Oil price spike removed oil from the Power generation business, This price spike has done it’s best to take oil out of the other bastion of oil consumption, the Automotive industry. Car manufacturers have done their best to slow the change but it clear that batteries would power the next generation. The Economist predicts Cars having ‘No Oil‘ hearts as soon as 2020.
I posit, given the uncertainty around the future energy sources( it could be hydrogen, it could be uranium, it could well be clean coal), failing to secure Oil resources may turn out to be a good thing after all. Being indecisive sometimes works out for the good.
This does not mean OVL should stop to looking for overseas oil fields, or ensuring safe passage of oil( via secure shipping routes and overland pipelines). It means we should hedge our bets by diversifying into alternative means such as Nuclear, or Wind etc. It is good for the earth and it is good for India.