India to become 3rd largest oil importer before 2025

India is set to become the world’s third largest oil importer after the US and China before 2025...

India is set to become the world’s third largest oil importer after the US and China before 2025, according to the International Energy Agency (IEA). While India’s importance as an exporter of refined oil products would increase on the back of planned investments in this space, the energy needs would propel India to overtake Japan as the third largest net importer of oil before 2025.

The country is ranked fourth in terms of oil imports. According to the ‘World Energy Outlook 2007’ report, published by IEA, rapid economic development in China and India would push up the global energy demand. In addition, the growing demand from the two Asian nations would also bring major economic benefits to the rest of the world.

“Economic expansion in China and India is generating opportunities for other countries to export to them, while increasing other countries’ access to a wider range of competitively priced imported products and services. But growing exports from China and India also increase competitive pressures on other countries,” IEA noted.

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Dominated by fossil fuels, India and China would account for 45 per cent of the world’s energy needs in 2030.

Pointing out that by 2030 global energy needs would be over 50 per cent higher than today’s, IEA said these trends will lead to continued growth in energy-related emissions of carbon dioxide and increased reliance on imports of oil and gas. “Both developments would heighten concerns about climate change and energy security,” the report added. It said that that immediate and collective policy action was needed by all the governments for a more sustainable energy path, but there has “so far been more talk than action in most countries.”

It also noted that the number of Indians relying in biomass for cooking and heating purposes would come down to 470 million by 2030 compared with 668 million in 2005. At the same time, the share of population with access to electricity is expected to rise to 96 per cent by 2030 in comparison with 62 per cent in 2005. The coal would remain India’s most important fuel and its use would probably triple between 2005 and 2030. Higher demand would be from power generation while among the end-use sectors, transport energy demand would witness fastest growth. The study noted that higher oil and gas prices were making coal more competitive as a fuel and that 45 per cent of the current coal is accounted for by India and China.

“The widespread deployment of more efficient power-generation technology is expected to cut the amount of coal needed to generate a kWh of electricity, but boost the attraction of coal over other fuels, thereby leading to higher demand,” it added.