United States-India Energy Security Cooperation Act of 2006

The December 2004 National Intelligence Council report entitled Mapping the Global Future in 2020 states that the single most important factor affecting the demand for energy will be global economic growth, especially that of China and India. It is estimated that the current economic growth rate in India is approximately 7 percent of gross domestic product. India will need to double its energy consumption within the next 15 years to maintain steady rates of economic growth.

The United States and India launched an energy dialogue on May 31, 2005, aimed at building upon a broad range of existing energy cooperation and developing new avenues of collaboration on energy. These efforts will promote increased trade and investment in the energy sector by utilizing resources in the public and private sectors, focusing on oil and gas, power and energy efficiency, new technologies and renewable energy, coal and clean coal technology, and civil nuclear cooperation. In his testimony before the Committee on Foreign Relations of the Senate on July 26, 2005, Under Secretary of Energy David Garman said, The United States and India recognize their mutual interests are best served by working together in a collaborative fashion to ensure stability in global energy markets..

As the sixth largest energy consumer in the world, India satisfies 70 percent of its oil demand with imports and has embarked on an aggressive oil and gas exploration program. The largest discovery of natural gas in the world in 2002 occurred in India. In 2003, the largest discovery of oil in the world occurred in the state of Rajasthan in India. External funding and investment in the oil and gas industry in India is necessary to maximize recovery from oil fields, but an improved investment environment in India is needed to attract such investment.

India is the world’s third largest producer of coal and will continue to rely on coal as a major energy source to support expanding industrial and electric power generation needs. However, many of India’s coal-fired plants are inefficient and lack adequate pollution control equipment. In his address to a joint session of the United States Congress on July 19, 2005, Prime Minister of India Manmohan Singh noted the importance of allowing greater access for developing countries to clean coal technologies and of exploring partnerships that encourage more efficient use of hydrocarbon resources.

India provides a market for United States technologies that promote the clean and efficient use of energy.

India has announced plans to develop a 5,000,000 ton strategic crude oil reserve, which is expected to be completed by 2009.

United States energy experts have emphasized the need for the United States to increase collaboration with other countries—

to cooperate with India to address common energy challenges, to ensure future global energy security, and to increase the world-wide availability of clean energy;

to promote dialogue and increased understanding between the United States and India on our respective national energy policies and strategies as an integral part of the expanding strategic partnership between the two countries; and

to collaborate with India in energy research that fosters market-based approaches to energy security and offers the promise of technological breakthroughs that reduce oil dependency globally.