India, Russia explore feasibility of gas pipeline

India and Russia on Tuesday discussed ways of further strengthening and expanding bilateral investment cooperation between the two countries across various sectors, particularly in the energy sector.

The fourth meeting of the India-Russia Working Group on Priority Investment Projects, held in New Delhi on Tuesday, proposed to launch an industry level working group to study the feasibility of laying pipelines for potential Russian gas supplies to the energy deficient South Asian country.

The India-Russia Inter-Government Commission on Trade, Economic, Scientific, Technological and Cultural Cooperation (IRIGC-TEC) at its 22nd session on Tuesday agreed to launch an industry level working group to create an "energy bridge" or pipelines for transporing Russian gas to energy-hungry South Asia, India's ministry of external affairs (MEA) said.

The 22nd Session of IRIGC-TEC, chaired by minister for external affairs Sushma Swaraj and Russia's deputy prime minister Dmitry Rogozin, noted that "there has been substantial progress with expanding cooperation in oil and gas sphere", as reported by the MEA.

The session aimed to finalise "concrete outcomes" in key areas of trade and investment before the 15 October India-Russia Annual Summit between Prime Minister Narendra Modi and President Vladimir Putin in Goa.

"Both sides launched an industry level Working Group - led by Gazprom, biggest Russian gas company, and a consortium of Indian oil and gas companies - for creating an 'energy bridge' between the two countries through possible gas pipelines for direct gas delivery from Russia to India," MEA said in the press release.

The two sides discussed the existing as well as proposed projects in two countries in sectors like chemical, automobiles, engineering, aviation, electronics, petroleum, pharmaceutical, highlighting importance and the issues for facilitating the projects.

The investment opportunities in Delhi-Mumbai Industrial Corridor Project for the Russian companies were also highlighted by the Indian side. Both sides recommended to the Russian and Indian companies to formulate and prepare a road map on the identified priority investment projects.

Strong growth in domestic energy demand together with inadequate supply from local oil and gas fields have led India to depend on foreign petroleum supplies, including Russia.

India consumed 4.159 million barrels per day of crude oil in 2015 against domestic production of 876,000 barrels per day, with imports providing around 78.9 per cent of the country's oil demand, according to BP Statistical Review of World Energy.

India is also depended on gas imports to bridge the supply gap. Data from the BP report indicated that India's gas production stood at around 1.03 trillion cubic feet (Tcf) or 29.2 billion cubic meters (Bcm), while its demand was around 1.79 Tcf (50.6 Bcm).

Sustained economic growth in India is expected to raise oil demand in the world's third largest petroleum consumer by 11 per cent this year, according to minister for petroleum and natural gas Dharmendra Pradhan.

However, the growth in India's oil consumption will be driven mostly by better monsoon rains and an acceleration of economic activity, he added.