Saturday, April 23, 2005

A Vision for India's Energy Sector

Crude oil prices are at around $50 a barrell currently and all expectations are that the price will go up. With the demand for petroleum and petroleum products surging in India because of a variety of reasons, the most important and significant of which is the huge increase in the number of vehicles, India's oil bill may rise to unsustainable levels.

A bouyant economy is allowing more and more people to buy motorcycles, cars, light trucks and sport utility vehicles for personal transportation. There is also an great increase in the number of heavy trucks and buses, in the usage of railways and now there surely will be a burgeioning demand for air travel, both for movement of people and goods. All these are positive developments except for the gargantuan quantities of hydrocarbons we need to import to fuel this demand for transportation.

I think this is the right time to develop a far sighted energy policy that decreases our dependence on imported oil. As a first step our prime minister could lay out a vision that challenges the domestic industry to come up with solutions to this problem. One good initiative would be for the prime minister to declare that in a 5 years' timeframe, he would travel only in an indigenously developed hybrid vehicle that would give a mileage of atleast 60km/L. That would be a tangible goal towards which the Indian industry could work and the goverment could structure its policy to facilitate the achievement of that goal. Later, the goverment could mandate that all goverment vehicles will be hybrid vehicles.

I am sure such a vision will go a long way in ensuring that we rid ourselves from too much dependance on imported oil.

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