GBA: India reaching out to non-G20 members before September summit

Russia, Saudi Arabia and China not convinced about joining multilateral initiative

India is actively reaching out to nations outside the G-20 grouping, seeking their participation in the proposed Global Biofuels Alliance (GBA), multiple officials told Business Standard, even as major energy producers like Russia, China and Saudi Arabia remain unconvinced about joining the multilateral initiative.

India's diplomatic missions are reaching out to a host of nations to ensure a full house when the Alliance is inaugurated by Prime Minister Narendra Modi during the G-20 Leaders Summit on September 9-10, they said.

On July 22, India held a global meet on the issue, on the sidelines of the G-20 energy ministers meeting in Goa.

After deliberations, it announced that 19 countries have expressed their interest in being the initiating members of the Alliance, without naming them.

However, at least 7 of the nations whose energy ministers attended the summit and unanimously supported the formation of the Alliance, were not G-20 members.

These countries include Bangladesh, Kenya, Mauritius, Paraguay, Seychelles, the UAE and Uganda.

"More countries are now being invited to join the GBA and many have responded positively. We have also heard specific inputs from the least developed nations. All these will be taken into account when the Alliance is launched and its policy goals are framed," an official said.

Apart from nations in the immediate neighbourhood, and its long list of allies in Africa, India is expecting support from Latin American nations, marshalled by the United States (US), which has given its support to the GBA.

New Delhi is also counting on the support of the Central Asian nations part of the Shanghai Cooperation Agreement bloc, which recently decided to collaborate on emerging fuel technology, energy modelling, and transition goals.

But within the G20 grouping, Russia and Saudi Arabia have not come fully on board owing to their fear that the alliance will intensify the growing clamour against fossil fuels.

Both Moscow and Riyadh rely on crude oil to finance large chunks of their budgets, and have called for continuing investment into traditional hydrocarbons during the global energy transition.

Meanwhile, China has shown "little interest in the proposal", the official added.

India can't do much to convince China to join the Alliance since it has competed with India on major multilateral initiatives.

Beijing has also prioritised biofuels in its national carbon reduction and fuel sufficiency plans and produces almost as much ethanol as India, according to the International Energy Agency (IEA).

However, officials from the Petroleum and Natural Gas Ministry said partners such as Russia and Saudi Arabia have been taken into confidence and been told the GBA will work in collaboration with relevant existing regional and international agencies as well as initiatives in the bioenergy, bio-economy, and energy transition fields more broadly.

This includes the Clean Energy Ministerial Biofuture Platform, the Mission Innovation Bioenergy initiatives, and the Global Bioenergy Partnership (GBEP).

Other officials, however, downplayed the realistic impact of the nations’ not joining the alliance.

"The US, Brazil and India account for a total of 85 per cent of the global ethanol production. The US holds a 55 per cent share followed by Brazil at 27 per cent and India at 3 per cent. India's share is expected to quickly rise. In terms of the global impact that such an alliance will bring, all the key participants are already ready," a Niti Aayog official said.

The US, Brazil, UK, UAE and Sri Lanka have officially begun preparations to join the Alliance.

Eyes on ethanol

The Alliance aims to place emphasis on strengthening markets, facilitating global biofuels trade, and developing concrete policies to provide technical support for national biofuels programs worldwide. 

However, the intensification of sustainable biofuel use, especially in the transportation sector remains among the biggest targets.

Meanwhile, India is the world's largest producer and consumer of sugar as well as the world's 2nd largest exporter of sugar. 

The sugar industry in India suffers from cycling issues of demand supply mismatch, low cost recuperation and wastage. 

As a result, the livelihood of millions of sugarcane farmers hangs in the balance every sugar marketing season. 

The government has pushed for diverting sugarcane supplies towards ethanol production to reduce this issue.

India is pushing to quickly raise the share of ethanol in petrol sold for transport use. The phased roll-out of E20 (20 per cent ethanol blending in gasoline)  has already reached 1,900 retail outlets across the country, the petroleum ministry said earlier this week.

The Niti Aayog believes having a global alliance will work towards building a global cooperative mechanism for increasing the role of biofuel in the global fuel basket.

The IEA has projected that by 2025, there will be nearly 180 billion dollars’ worth of biofuel on the international market.

New Delhi is pushing to ensure it dominates a policy space that dictates this market.

Seeking support

Russia and Saudi Arabia rely on crude oil to finance their Budget 
 

PM to inaugurate the Alliance during the G20 Leaders Summit in September  
 

Along with neighbouring countries and allies in Africa, India expecting support from Latin American nations