India needs clean fuel for growth

INDIA ECONOMIC SUMMIT 2006

The country must use energy efficiently and employ new technologies for doing so, is the consensus at the Summit

On the threshold of a double-digit growth rate, India needs to ensure that smart energy and environmentally-safe fuel propel its development. Reconciling the issues of efficient energy and affordability is a crucial challenge facing both the state and the private sector.

The state needs to align incentives for the private sectorwith public policy and needs to better target subsidies. Should India consider monetising the cost of pollution to foster innovative energy solutions that are efficient and environmentally non-hazardous? These are the issues which NK Singh, deputy chairman, Planning Commission, Bihar brought to the fore during the session.

According to MS Srinivasan, Secretary, Ministry of Petroleum and Natural Gas, the issue is how to use energy efficiently while enhancing access and adoption of environmentally sustainable resources.

This is more important for the automobile sector, since 60-70 per cent of primary petro-products are used for transportation.

While standards of vehicular pollution in India are aligned with those in the West, improving the air quality despite more vehicles on the road, newer technologies are still required.

Srinivasan also stressedcleaner technology for coal extraction and increased production and use of natural gas.

Ian McCartney, Minister of State for Trade, Investment and Foreign Affairs of the United Kingdom, stated that public-private partnership is crucial for containing ecological damage, both in India and globally. He said the UK was ready to contribute knowledge and expertise and partner with India to protect the environment.

Effective use of technology was central to development, said Mukesh D Ambani, Chairman and Managing Director, Reliance Industries, speaking about the symmetry between efficiency and sustainability on the one hand and cost and availability on the other. He said the Indian legislative framework limits the damage to the environment.

The nuclear deal, which was recently approved by the US senate, presents a great opportunity to India to produce clean energy. "India has huge resources of natural gas and oil that need to be tapped in an environmentally sensible manner," he added.

Diego Visconti, International Chairman, Accenture, Italy, said sectors such as technology, software, services and outsourcing have been revolutionised by India.

However, these were concentrated in a few places, leading to overheating and congestion. India needed to replicate its own model for equitable growth. This could be quickly implemented with minimal investment, as the technology and infrastructure were already in place.