How 'Energy War' will redefine India-China relations post-Doklam

“Energy” is the lifeblood of economic growth. With both China and India having chosen the path of rapid industrialisation to exponentially increase employment opportunities for their teeming millions, a conflict between these two nations is likely to arise in the foreseeable future over the world's energy resources, which include Coal, Lignite, Natural Gas, Crude Oil & other Hydrocarbons, Nuclear, Solar, Wind, & Hydro Power.

Recently, China has achieved a meteoric rise as the world's factory. With the largest human population in the world, the country is among the major energy guzzlers of the world. International Energy Agencies predict that by 2030 China would be consuming 21 per cent of all the energy resources of the world.

On the other hand, India, the second most populous country in the world, is ranked fifth in the world in terms of primary energy consumption – behind the US, China, Russia & Japan. With a high GDP growth that has been hovering between 7 to 6 per cent, India, by 2030,  is expected to vault to third place in this regard – behind only the United States & China. 

“Energy” is the basic bedrock of all industrial activities. While from 1979 to 2003 China's annualised energy consumption rate grew by 4.4 per cent and its annualised GDP growth rate reached 9.36 per cent, its annualised energy output growth lagged behind at 3.82 per cent.

On the other hand, India's industrial growth story, commencing only about 10 years back has so far been more or less self-dependent in energy matters. However, given India's present emphasis on establishing a strong industrial infrastructure, and with massive planned investments in this regard, sooner rather than later, India is likely to become a serious competitor to China in the battle for a progressively larger share of the world's energy resources.

It is, therefore, critically important for both countries to urgently address their respective “energy requirement issues” which, if ignored, could lead them on a confrontational course with disastrous results.

In order to explore new avenues to secure their future energy needs, both countries are aggressively competing for new sources of energy in Kazakhstan, Iran, Afghanistan and Myanmar.

In fact, China, which started out on the industrial growth field nearly two decades before India did, planned and is setting up its port project at Gwadar (Pakistan), primarily, as a transit facility for crude oil supplies to Xinjiang through Kyaukpyu (in Myanmar, off Andaman Sea), which starkly brings into focus the delicate balance of industrial and military power in South Asia.

Post-Doklam, however, India and China have entered a new phase in their trade relations. The hardliners in the Chinese Communist Party who wanted to “punch” India along the LAC seem to have lost the battle.

The “pro-India faction” is increasingly dominating policy within the CPC which experts say wants more trade relations with India.

As a matter of fact, China’s state-run daily The Global Times has been carrying Op-ed articles on how India and China can cooperate in various fields, especially in infrastructure and e-commerce among other things.

With China set to re-elect Xi as the president for the next five years during the CPC meeting this month, India and China should look to cooperate not only in resolving their disputes along the border but also in joining hands to evolve an “energy policy” to ensure both countries enjoy their growth story as equal partners.