India-Africa Hydrocarbon Conference & Exhibition
November 6-7, 2007, New Delhi

Inaugural address by Shri Pranab Mukherjee, Hon'ble Minister for External Affairs

Minister for Petroleum & Natural Gas, Shri Murli Deora,
Hon'ble Ministers from African countries,
Excellencies,
Distinguished Guests,

It is indeed an honour for us to receive all the dignitaries from various African Countries. I thank all of you for taking time out from your busy schedules and for reinforcing our commitment to further deepen the cooperation between India and Africa in the vital energy sector.

India, as we all know, is experiencing accelerated economic growth. Annual growth rates of between 8% & 9% are driving the nation's increasing demand for energy. Like many other countries, it is natural that India too should be concerned about existing and potential sources of supply for meeting its requirements on a sustained basis.

India faces formidable challenges in meeting its energy needs. According to the Integrated Energy Policy document of the Government of India, the country would need to expand its current primary energy supply levels by 3-4 times and electricity generation by 5-6 times in the next 25 years in order to sustain the high growth levels required to attain our developmental goals and to eradicate poverty. Owing to the limited availability of oil and gas within our country, 70% of our energy requirements are dependent on hydrocarbon imports. What is of particular concern to us is that this import dependence is only going to accentuate further in the coming years.

This realization has pushed al of us to adopting proactive approaches for ensuring our energy security, particularly with reference to hydrocarbons, which account for nearly half of India's total energy needs. The task of investing in overseas energy assets for the country has, therefore, become an important aspect of our economic diplomacy. Indian oil companies have concluded arrangements, including investment agreements, with many countries for the supply of oil and its derivatives to India and in most of the cases, delivery has begun. In addition, the possibility of bilateral cooperation in the downstream sectors, petrochemicals, non-conventional energy and joint ventures are also being constantly explored with various resource-rich countries.

Excellencies, Distinguished Guests,

The Ministry of External Affairs attaches high priority to energy security. The newly created Energy Security Unit in the Ministry bears testimony to the government's resolve to treat this as a matter of urgent national importance. As the nodal point in the Ministry, this Unit will maintain close coordination with the concerned Ministers, as well as our corporate entities in both public and private sectors, to support their international engagement through appropriate diplomatic intervention. Given this background, to secure a long term, cost effective and reliable mode of resource supply, we are keen to explore the prospects of sourcing energy from our neighborhood and beyond.

India is presently looking at an all -round effort wherein domestic exploration exercises are being intensified, coupled with greater emphasis on 'equity oil' from overseas. Efforts towards technology improvements have also paid off. Indian companies are collaborating with international companies for greater sharing of technology and know-how leading to higher efficiency in our operations. These measures, along with efforts towards adoption of advanced technology and professional management, as well as forays into tapping emerging areas like coal gasification, Coal Bed Methane (CBM), gas hydrates and other sources of energy, have shown encouraging results. Greater consideration is also being given to efficient utilization of energy resources. The Indian hydrocarbon industry has come a long way on all these fronts.

The New Exploration Licensing Policy (NELP) and the CBM are new frameworks for cooperation in the area of energy resources management. The six rounds of the New Exploration Licensing Policy have successfully attracted investments from Indian as well as global investors. Over the years, exploration activity has been intensified and positive results have been forthcoming with important discoveries by operators in the Krishna-Godavari Basin and the on-shore blocks in Rajasthan. Similar success has also been observed in the bidding for the CBM blocks.

India has re-doubled its efforts to attract investments to develop its energy sector, including power generation and oil refining, which are now open to private and foreign investment. There is new and huge market potential in India for those who have competitive products and services to offer in the energy sector. Possibilities of cooperation on the non-conventional energy front are also being explored. An Agreement has been signed with Brazil for cooperation in bio-fuels and ethanol. We are exploring the possibilities of civil nuclear cooperation and, if we succeed, it would also open up immense possibilities for the growth of nuclear energy security thereby strengthening energy security for the country.

Excellencies, Distinguished Guests,

India is increasingly looking at taking its partnership with Africa which would be mutually beneficial to both sides. We are a natural market for Africa's rich hydrocarbon resources. Prospects for cooperation with African nations in the hydrocarbon sector have also received a boost with a surge in investments made by Indian companies in countries such as Libya, Sudan, Nigeria, Egypt and Gabon over the past few years. We hope that from here on, we will together traverse the path to growth and development.

One of the crucial questions that confront all resource-rich countries is how natural endowments can be utilized to build a diversified economy and ensure economic and social development. Since the relentless quest for new energy sources is expected to continue all round the world, including in Africa, it must be ensured that such exploitation takes place in an equitable and humane manner. In this important sector of hydrocarbons, which has a direct correlation with economic growth, investment in human resources is also an important aspect. In this regard, India stands ready to share its experience with its African partners in the hydrocarbon sector, from exploration to distribution through refining, storage and transportation.

It is crucial that over a period of time, investment in this sector should directly assist in the building up of a trained and skilled work force capable of efficiently running the assets.

Excellencies, Distinguished Guests,

India's foreign policy remains vigilant to the new demands and compulsions imposed upon it by a rapidly transforming world around. We are confident of our capacity and capability as a nation to respond successfully to these newly emerging challenges and opportunities. We seek the cooperation and support of our friends and partners in Africa to achieve this objective. On this occasion, I would like to congratulate the Ministry of Petroleum & Natural Gas, FICCI and UNCTAD for their timely effort in bringing together the key officials and business stakeholders in this sector in India and Africa to collectively identify the areas for cooperation. I am sure that this Conference will help evolve a vibrant and mutually beneficial business environment in the years to come.

To conclude, I would like to reiterate that India is more than willing to share its experience and its technologies in the hydrocarbons sector with African countries in order to forge meaningful partnerships which can respond to the challenges of development facing our people. We have maintained traditionally warm and productive relations with all African countries. Our engagement has been characterized by close convergence on global political and economic issues, particularly those affecting the developing world. Closer cooperation between India and the African countries in the hydrocarbon sector would further cement and consolidate those relations and contribute significantly to forging strategic partnerships for mutual development.

Thank you