Why coal looms large in India’s future – by Peter Foster (National Post – April 17, 2015)

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Narendra Modi is the first Indian Prime Minister to visit Canada since Indira Ghandi. For much of the intervening period, relations were sticky because of that unfortunate business of India using Canadian technology to manufacture nuclear weapons. At the same time, India’s growth was held back by poor economic policies and widespread corruption, much of it soaked in socialist cant.

Those lousy policies also go back to Mrs. Ghandi. Mr. Modi is rightly seen as a breath of fresh air, even if he inevitably has to play the hypocritical game of global realpolitik.

The alleged landmark deal of Mr. Modi’s visit is India’s $350 million purchase of Saskatchewan uranium. This both symbolically buries the bomb issue, and enables Mr. Modi to trumpet his country’s commitment to “sustainable development,” even as SD is increasingly exposed for the unworkable non-concept that it is.

The notion first emerged at the 1972 UN conference on the environment in Stockholm. Conceived by British intellectual Barbara Ward, who thought the Industrial Revolution had been a mistake, SD’s conceit was that poor nations had to grow while avoiding free markets and fossil fuels.

Mrs. Gandhi gave the keynote speech in Stockholm. She blamed the profit motive for wrecking the environment and keeping people poor. Mr. Modi is clearly of a more market-friendly orientation, even as he continues to pay lip service to sustainability. Indeed, he suggested that the uranium deal was part of “saving the world” from the climate change. With respect, India’s role in such salvation comes on a pretty small scale.

India currently derives less than 4% of its electricity from nuclear energy, and although it has announced bold plans to expand this to 25% by 2050, 2050 is a long way off. For the immediate future, India has announced that it will double its coal use by 2020, in the process overtaking the U.S. as the world’s second largest coal consumer after China.

The International Energy Agency predicts that global coal demand, along with that of oil and gas, will still be rising in 2040, when fossil fuels will account for three-quarters of energy use. Asia in particular is destined for an enormous burst of coal investment. A great deal of the funding will likely come from the new Asian Infrastructure Investment Bank, AIIB, an initiative promoted by China in the face of staunch U.S. opposition.

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