India is considering trade deals with Southeast Asian countries through Myanmar and Thailand, five sources briefed on the matter said, as New Delhi looks to leverage its growing renewable energy capacity to boost diplomatic engagement in the region.
The government of Indian Prime Minister Narendra Modi has sought to foster closer political and economic ties with its neighbors to counter China’s growing regional influence. Indian energy ministry officials held group and separate discussions with several countries at the Group of 20 (G20) ministerial meeting in Goa, India, to advance regional power grid interconnections, an energy ministry official said.
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Support from G20 members is seen as key to getting buy-in from bankers and developers for investment decisions, a ministry official said. India has been working with EDF (EDF.PA) to create a regulatory framework to address key challenges, including pricing, the industry official said. EDF expects to finalize the report by the end of this year, the official added.
While cross-border grid connections have attracted investment and government interest in regions from Europe to Southeast Asia, the rising cost of submarine cable construction, soaring prices of raw materials needed to upgrade networks, and geopolitical tensions have raised questions about the viability of such projects.
For decades, members of the Association of Southeast Asian Nations (ASEAN) have tried to create a regional network to facilitate multilateral power trade, but progress has been limited to bilateral agreements between countries.
The network links could take at least four years to finalize after India tried to build trade strength with Middle Eastern countries such as the United Arab Emirates. The sources also included four Energy Ministry officials who declined to be named because of previously unreported or unpublicized plans. India’s Federal Ministry of Labor did not immediately respond to a request for comment.
India plans to increase its large-scale renewable hydropower capacity to 500 gigawatts (GW) by 2030, from 177 gigawatts (GW) currently. Solar parks are expected to account for most of the new capacity additions. Ministry officials said the effort could help reduce dependence on fossil fuels by making solar power available longer in the day.
Another official at the ministry said the transmission cost of using power from interconnected regional grids is a big challenge. The official added that the interconnection will take place both under the sea and on land, facilitating the integration of renewable energy by bringing together resources across the region.
India already exports some energy to Bangladesh, Nepal, and Bhutan, and a small amount to Myanmar, a number that will increase significantly under the new plan.
Source: reuters.com
