India’s Challenges in Middle East
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Issue Net Edition | Date : 30 Jan , 2021

Shiite Populations in the Greater Middle East (Source: Pew Research Centre; US Department of State; Brandeis University)

Energy security has long been a concern for India, a global giant in oil consumption. The fuel demands are growing fast in proportion to its rapid economic development. Oil and natural gas are expected to remain India’s main source of energy in the coming two to three decades at least. Due to the lack of significant domestic reserves of oil and natural gas, India has looked towards the geopolitically challenging West Asia (India conceptualizes the Middle East as West Asia) to fulfill its requirements throughout much of its independent history.

Also, the prosperity brought on by oil enabled large-scale development which enabled a large number of Indian migrants to seek work in the region, especially in Gulf countries. To put in numbers India imports 53 percent of its oil and 41 percent of its gas from West Asia and over 8.5 million Indians work in the region. New Delhi does not believe in the policy of subscribing to one or the other side in the volatile political environment of West Asia.

It has always believed and pursued a balanced diplomatic approach in the turbulent region. India has thus cultivated a number of important bilateral relations in the region most importantly with Israel, Iran and Gulf monarchies like – Saudi Arabia and UAE. Partly because all these relationships are so strong and valuable that India would prefer not to choose between them. India avoids picking sides in the volatile and geo-politically important region. So that it can be viewed as a friend of all and a threat to none.

Even though after pursuing a balanced policy in the region India still has some challenges which it needs to address,  so that it can rely on West Asia as its most trusted source of energy. First of all, India lacks direct investment in the energy sector of this oil and gas-rich region. Intensification of direct investments in the West Asian energy industry, both at the public and private sector levels is very much required.

Indian policymakers can accelerate earlier assurances of energy cooperation with countries such as Iran and Saudi Arabia. They can also use security and defence accords with these nations to make healthy measures for the fortification of these investments. India should work to sign more defence treaties on bilateral (such as agreements signed with Qatar and Saudi Arabia etc.) and institutional levels (such as GCC) and make sure to include energy as a strategic asset in these agreements. Indian government aspires to establish strategic petroleum reserves for 45 days ideally to hedge against any geopolitical volatility. For that direct investment in the oil assets overseas is a must.

The current and highly dynamic geopolitical situation in West Asia is a concern. The region is quickly turning into a highly polarised part of the world. The growing divide between Riyadh and Tehran and Washington’s hypocritical ignorance could put New Delhi in a spot of bother. Till now, India has maintained ambiguity in the internal matters of the region and chose to remain neutral in any conflict.

But growing power struggle between the Sunni bloc led by Saudi Arabia and Shia powerhouse Iran is pressuring India to choose sides. In addition to this India’s growing deep relations with Israel can also be viewed by anti-Israel camp in the region as New Delhi is picking sides.

In the coming time, India has to walk a tight rope to simultaneously maintain all these multiple relationships. India has to be very cautious not to step over the region’s many fault lines. To be seen as a friend of all, India should resist any pressure to take sides and be wary of being sucked into the rivalries in the region. Non-alignment as a movement may have lost its significance. But as a foreign policy doctrine that allows India to retain its strategic autonomy even in the wake of crises and pressure, should always continue to inspire its policymakers.

Another emerging threat in the region is of non-state actors. Large scale instability and growing terrorism in West Asia has increased the threat of takeovers of natural resources by non-state actors. In April 2013, ONGC Videsh an international subsidiary of India’s Public sector undertaking ONGC lost control of its oil investments in Syria’s Deir-Ezzor region. As the oil field where India (along with China and others) was part of a conglomerate that had invested, was overrun by the Syrian rebel fighters, suspending all exploration and production activities in that part of Syria.

High emphasis should be given to the security of Indian assets and commercial interests in the region. For that India can initiate military training exercise routines with more countries from West Asia on issues such as protection of oil assets from terror attacks, antipiracy, and protection of international sea-lanes.

China is a big player that should not be forgotten in discussions of West Asian diplomacy. It’s Belt and Road Initiative creates enormous opportunities in the region and could pose an economic challenge to India’s plans. China’s growing economic influence in West Asia is increasing its diplomatic clout as well. But at the same time, India has an advantage over China, having treated its Muslim populations in a much better way than China and also being seen as on good terms with the United States. India must continue ramping up its diplomatic initiatives across West Asia, partly as a response to China’s increasing participation in the region.

The growth in India’s energy demand between 2016 and 2040 is expected to outstrip that of China as well as a number of entire regions around the world. The economic co-dependency between India and West Asia is here to stay. Any new conflict that threatens India’s energy supplies or inflates energy prices could take a toll on India’s economy and complicate ties. Moreover, any instability or active conflict between regional players will test India’s commitment to a policy of neutrality and non-interference.

In this emergent scenario, New Delhi needs to be able to put its own financial and political resources to gain a stronger foothold in the region. The political problems of ‘West Asia’ are not going to be solved anytime in the near future. And India will have to work within the existing constraints to bolster its means to further secure energy security. New Delhi should also look forward to work with other major Asian players that have similar concerns such as South Korea and Japan to secure energy deposits and supply chains.

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The views expressed are of the author and do not necessarily represent the opinions or policies of the Indian Defence Review.

About the Author

Manish Rai

A columnist for Middle-East and Af-Pak region and Editor of geo-political news agency Views Around.

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