Russia oil cap benefiting India: German envoy
German Chancellor’s foreign and security policy adviser, Jens Plotner, on Monday said India is benefiting from the price cap on Russian oil imposed by major economies of the world although New Delhi is not a party to the decision by the West to impose the cap in early December to reduce Moscow’s earnings from fuel that, according to them, is “financing its war against Ukraine”. Plotner said this at a media interaction after his meetings with external affairs minister S. Jaishankar and national security adviser Ajit Doval. Plotner is in India in connection with the visit of German Chancellor Olaf Scholz later this month. The price cap — introduced by G7 countries along with the European Union and Australia — came into effect on December 5 and bars countries from paying more than $60 a barrel for Russian oil. It prevents Russian crude sold for more than $60 from being shipped using G7 and EU tankers, insurance companies and credit institutions. Since the insurance companies and credit institutions are based in G7 and EU countries, this has had a cascading effect, and Russia earlier this month announced that it will cut production from March. Plotner avoided commenting on India’s decision to increase its oil purchases from Russia since the war with Ukraine began on February 24 last year, maintaining that Germany cannot comment on this having been a major consumer of Russian oil and gas for decades. The price cap is designed to reduce Russia’s revenues and its ability to fund the war in Ukraine and limit the impact on global energy prices, particularly for low and middle-income countries. Russia has warned that it will snap oil supplies to any country that joins the price cap plan. As for India’s offer to mediate in the Russia-Ukraine war, Plotner said: “India quite naturally comes into consideration when you deal with these kinds of complicated conflicts. This having been said, at this moment we do not have a shortage of mediators but we have a shortage of Russian willingness to stop this war and get out of its neighbour country…. The Indian angle is very important… the voice of New Delhi is one which is heard very clearly and which is listened to in Moscow and that makes it all the more important.” On his meeting with Plotner, Jaishankar tweeted: “Discussed our expanding strategic partnership and exchanged views on the situation in Europe and the Indo-Pacific.”
How coal gasification can help India reduce its oil & gas import
India has been blessed with large coal deposits, especially in the eastern part of the country. Recent reforms in the coal sector, like commercial coal block auctions, engagement of MDO by Coal India Limited (CIL) for faster development of Greenfield projects, single-window system developed by the Ministry of Coal for the faster clearances, auction of abandoned/discontinued mines by CIL on the revenue-sharing basis and better coordination between Central and State Governments, have paved the path for increased self-dependency in the coal sector. The domestic supply of coal is expected to be more than the requirement for power generation in the next 2-3 years which will ensure that coal is available to other sectors. Due to poor deposits of oil and gas in India, coal can be a way for India to reduce import dependency. And one of the best ways to ensure the clean utilisation of coal is through coal gasification. Coal gasification is a process that is more environment-friendly as compared to the combustion of coal and can be a better option for the future use of coal. Through products derived from Syn gas (produced via gasification of coal), such as Methanol, Ethanol, Ammonia, Ammonium Nitrate, and Dimethyl Ether (DME), imports can be substituted. And syn-gas can also be used for producing Grey/Blue Hydrogen for steel-making and for usage in refineries. With India targeting net zero emissions by 2070, the future of coal depends on coal gasification as the process generates less CO2 and it is also easy to capture CO2produced during the gasification process. Coal gasification strategies consist of four major components, such as — making coal available for coal gasification projects, identifying suitable coal gasification technologies, including Carbon Capture, Utilisation and Storage (CCUS) and setting up coal gasification projects and market dynamics for the end-products which are expected to face a challenge from imported products based on natural gas. Coal availability The coal sector in India has witnessed steady growth over the last eight years. All India coal production in FY22 was 777 MT, with a growth of 8.5 percent over FY21, and registering a substantial increase from 566 MT in FY14. Coal production from captive mines has also registered a 30 percent growth in FY’22 with a production of 86 MT. Similarly, domestic coal offtake witnessed 18.4 percent growth in FY’22, amounting to 818 MT, which is substantially higher than the offtake level of 572 MT in FY14. In FY23, till December, there has been a growth of 16.1 percent in coal production over the last year as the figure settled at 607.3 MT and an increase of 6.9 percent in offtake with 637.2 MT. Five tranches of commercial coal auctions have been successful, consisting of 64 coal blocks with a total peak-rated capacity of 152.4 MT. In FY24, coal production from captive/commercial blocks will also supplement Coal India’s production target of 780 MT and SCCL’s 75 MT and will ensure domestic coal production of 1 BT.