India is also in the process of increasing the share of natural gas in its energy mix, which presently stands at 8%”¦ There have been significant gas finds off Indias east coast in 2002 and recently 2005, but being deep-sea finds, the production is not cost-effective.
India is presently the sixth largest global energy consumer. Its energy situation is more critical compared to that of China. Coal meets only half of its needs, and here too, some superior-quality coal is imported. While oil makes up 30% of energy mix, oil reserves are relatively poor. India’s mere 5 billion barrels of proven reserves (as against China’s 18) has led to it importing 70% of its needs (compared to China’s 40%), all from West Asia. It is estimated that consumption will rise from the present 2.6 Mb/d (2004) to 3.2 Mb/d by 2010, with India emerging as the fourth-largest oil consumer. This would lead to greater dependence on West Asia for oil.
India is also in the process of increasing the share of natural gas in its energy mix, which presently stands at 8%. Its consumption of 32.1 Bcm in 2004 was a rise of 7.1% over the previous year, faster than any other fuel in recent years. However, domestic production is limited. There have been significant gas finds off India’s east coast in 2002 and recently 2005, but being deep-sea finds, the production is not cost-effective. While overland imports are more economical, it remains to be seen whether the pipelines from Iran and Bangladesh/ Myanmar would fructify. Even if they do, a significant amount of LNG would continue to be imported from West Asia.
The ‘New Silk Route’
Block arrows are often used on statistical maps to depict the flow of commodities across the sea-lines, its width being directly proportional to the quantity being transported. The one depicting energy flow that extends from the Persian Gulf to the Western Pacific (through Indian Ocean) is particularly broad and widening. This is due to the concentration of fossil-fuel reserves in West Asia and the rising energy demand of growing economies in the Asia-Pacific. Some security specialists refer to it as akin to the fabled “Silk Route”, which is indicative of its importance as a crucial link.7 Other vital sea-lines also merge with this ‘New Silk Route’ (NSR).
The NSR passes through the Straits of Hormuz and Malacca. The former links Persian Gulf to Arabian Sea, through which 15 Mb/d or 40% of the world’s oil passes. The Malacca-Singapore strait connects Andaman Sea to the South China Sea, through which, a quarter of the world trade passes aboard more than 62,000 vessels each year, carrying about half of the world’s oil and two-third of its LNG. 11 Mb/d of oil (10 from Persian Gulf plus one from Africa) crosses it, which includes 80% of China’s imports.
Between the two choke points, the NSR extends through 8/9-degree-channel close to India’s Lakshadeep (islands) in Arabian Sea, passes south of Sri Lanka and then crosses 6-degree-channel (between India’s Great Nicobar Island and Indonesia’s Sumatra Island), before it leads the ships through the Malacca Straits to the East Asian energy consumers.
The Imperilled NSR
Much of the insecurities of sea-lines stem from inherent vulnerabilities – unregulated nature of the maritime realm, fragile trading system and trans-national nature of shipping industry.8 The energy shipments are especially assailable – the 4,000-odd slow-moving and tardy-to-manoeuvre tankers, some of these carrying hazardous cargo like chemicals and LNG. Among the global regulations, the new technological measures like the 9,000-volt electric fence around the ship cannot be employed by these vessels due to the inflammable nature of cargo. Besides, since the rules do not permit firearms on vessels, the high-pressure fire hoses are the only means for self-defence.
The major threat to shipping in the Malacca Straits is piracy. Until a few years back, the boarding of ships for petty theft was more common. The attacks have now become more violent and well orchestrated.
The NSR is particularly vulnerable at the straits of Hormuz and Malacca-Singapore. The former is only 1.5 miles wide at its narrowest point and has no alternative sea-route. The indiscriminate attacks on neutral vessels in the Persian Gulf during the 1984-87 Iran-Iraq Tanker Wars led to the US deployment of naval forces, which continues to this day. Since then, the Gulf has been relatively tranquil, but precariously. West Asia is a sub-region from where maritime-terrorism has struck oftentimes. In 1985, the Achille Lauro was hijacked by Palestinian militants. In 2000, the USS Cole was bombed at Aden by Al Qaeda operatives and the modus operandi was repeated in 2002 for the French supertanker Limburg off Yemini waters.
9/11 is indicative of the fact that terrorists are now increasingly resorting to new attack means for mass effect. Energy flow could be an attractive target, an attack on which could cripple global economy. The worst hit, of course would be the US and its allies; disruption of their economies would also impair their military might.
The above is not a mere conjecture – soon after the Limburg bombing, Bin Laden’s audio tape warned the West: “…the youths of God are preparing for you things that would… target your economic lifeline until you stop your oppression and aggression.9 The Al Qaeda cannot cut-off energy flow to the West by blocking the Strait of Hormuz since Saudi Arabia’s East-West 750-mile oil pipeline from Abqaiq to Yanbu (on Red Sea coast) provides an alternate route. This leads to a greater likelihood of attacks on the Gulf’s energy infrastructure, port facilities handling energy transportation and westbound tankers in port. Such attacks would have severe repercussions for China and India, directly starving them of energy. In any case, this would lead to skyrocketing of oil prices, shipping charges and insurance premiums. Overall, the process of their economic development undertaken by the two countries would be stalled. Even the overwhelming coalition naval presence in the Gulf has not been able to deter the jihadis. In April 2004, Al Qaeda carried out suicide-boat attacks on two Iraqi oil terminals at Al Faw. In June 2005, the super-tankers employed for exporting Iraqi oil were attacked.10 Thus, the energy infrastructure and transportation in West Asia remain lucrative targets waiting to be hit, particularly when the western military presence is scaled down.
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