96215India's growth model is a disaster
- Jun 25, 2014Source: Hindu Business LineURL: http://www.thehindubusinessline.com/opinion/indias-growth-model-is-a-disaster/article5975840.eceDate: 5.5.14
Indias growth model is a disaster
The country lacks the energy resources to sustain a consumption-oriented economic system
Sam Tranum wears many hats. He is a journalist, novelist and teacher. He is an MA in international relations from the University of Chicago and has spent time in India , Kyrgyzstan , Turkmenistan and many other parts of the globe teaching, working and researching on energy issues. His latest work, Powerless: India s Energy Shortage and Its Impact (Sage Publications), paints a frightening picture of the countrys energyecosystem. In a chat with Business Line, Tranum talks about the book, whats wrong with India s energy policies, and more. Edited excerpts:
Why this book?
I moved to Kolkata in July of 2011, so that my wife, who is a journalist, could take a job there with The Statesman. We had been living in Washington DC , where Id been writing as a journalist for a couple of years about the energy business. When I arrived in Kolkata, my plan was to continue to write for them, covering the energy business in India . So I started reading everything I could find about India s energy sector. But I couldnt find a book that would give me the kind of detailed overview of the sector that I wanted.
Youre saying this is a prescriptive work. Why?
The solutions are already known. Or, rather, I dont think that the problem can be completely solved in the context of Indias current development model, but measures that could ease the shortage and its impacts are well-known.
Politicians are more worried about winning the next election than addressing long-term systemic problems. Its understandable: if they tried serious reforms, theyd get blamed for any short-term pain and probably wouldnt get credit for any long-term benefits. I dont think theres any lack of good prescriptions; theres a lack of natural resources, exacerbated by a lack of good governance. The only wayIndia s public servants are going to address the countrys energy problems is if the public makes them do so.
How bad is the situation?
India has about 17 per cent of the worlds population, but only about 0.3 per cent of the worlds proved reserves of oil; 0.7 per cent of the worlds proved reserves of gas; 7 per cent of the worlds proved reserves of coal; 2 per cent of the worlds identified resources of uranium.
Clearly, theres a huge mismatch between India s energy resources and its population. Current renewable technologies and resources cannot bridge this gap: To meet its electricity needs, India plans to add about 208 GW generating capacity in the next 10 years, according to the Central Electricity Authority.
But it has only about 347 GW of renewable potential, including: 149 GW of large hydro, 100 GW of solar, 49 GW of wind , 17 GW of biomass, 15 GW of small hydro, 8 GW of tidal, 5 GW of bagasse, 4 GW of waste-to-energy.
Of this 347 GW, India is already using 62 GW. A thought experiment on how far the remaining renewable potential could go to meet Indias thirst for electricity: If the country stopped building coal-fired, gas-fired, and nuclear power plants and built only renewables it would end up using 73 per cent of its renewable potential in about 10 years. And then what?
Is the government not doing enough to address the problem?
These are massive, complicated, difficult issues. Even for a hypothetical perfect government they would be hard to address, much less solve. The amount of energy resources that Indias territory hosts is simply not sufficient to allow its citizens to live in the manner to which they would like to become accustomed. To make things harder, theres always a lack of resources, technology and manpower, and theres always the evil of corruption.
Meanwhile, private companies are inherently interested only in their own gain (and/or their shareholders gain), and not in the national interest.
I dont see the energy problems as the failure of any particular government or party. I see them as the natural consequences of a country pursuing a development model for which it lacks sufficient energy resources, paired with a system of governance that doesnt offer incentives for leaders to make hard decisions.
Youre suggesting that India can opt out of this western-style energy consumption race. Is it that easy?
Pursuing Western-style industrial development puts India on a certain trajectory in terms of energy consumption. Given the available technology and Indias currently known energy resources, I would say that this trajectory is completely unsustainable.
I dont think that Indias going to find large enough new energy resources to fundamentally change this. Therefore, the only solutions I see are technological advances that allow India to produce vastly more energy within its current territory, or a radical change of course, to a new development model.
However, theres no country out there developed or developing thats pursuing a new development model, which India could look to and emulate.
How important an alternative is renewable energy?
Renewables must be part of the solution. Not only is Indias energy hunger so great that it must draw on every known resources or starve, but the environmental benefits of renewables are critical.
However, renewables cannot meet Indias two main energy needs, electricity and transport fuel. Given the tiny number of electric vehicles now in service, renewable-generated electricity cannot even begin to meet the countrys thirst for transport fuel.
Hopefully, renewable energy technologies and our understanding of renewable energy resources will develop, and this picture will change, allowing India to meet a larger share of its energy needs with renewables. Technology in this area is developing fast.
So is it all doom?
India has good, forward-thinking, enlightened laws and policies on the books. The problem is the perpetual gap between the high-minded rhetoric in New Delhi and the State capitals, and its implementation on the ground. Good policy often translates into inaction, bungling, corruption and failure.
In my view, this is because of a lack of resources (budgetary resources and highly skilled, motivated staff), poor governance, and corruption; the latter two, of course, contribute to the lack of resources.
If I were put in charge of solving Indias energy shortage, I would almost forget about making new strategies, plans, policies or laws. Id instead focus 99 per cent of my attention on improving implementation of existing good policies.
Having a more humane land acquisition, rehabilitation and resettlement law on the books is useless if no one follows it and families are still chased off their land by force, with no compensation and nowhere to go. That said, one policy I might change is encouraging (or allowing) OVL and other companies to spend billions buying into oil, gas, coal, and uranium resources overseas; it is terrible policy. This spending may never lead to production, only to the creation of jobs in othercountries. Even if it does lead to production, that oil, gas, coal or uranium may never return to India to help fill the energy gaps.