India and China to discuss energy: cooperation or competition?

April 4, 2005

Chinese Premier Wen Jiabao visits India this week, appearing on the forefront of a dialogue soon opening between the two most populous nations in the world. It is likely the two nations will engage in a growing race to gain access to energy resources they need for their soaring economic expansion.

The premier was received by Tata Consulatncy Services CEO Mr. Ramadorai during his visit to Bangalore. He then visited the TCS Global Development Center for General Motors(GM). The CEO of TCS was quoted saying "Premier Wen's visit is a significant milestone that has added a further impetus to our presence in China".

Both countries seek to secure oil from multiple locales around the globe where most Western nations cannot compete, including Sudan and Myanmar. China also is courting support from Venezuela, currently one of the largest suppliers of oil to the US. If successful, Chinese and Indian demand has the potential to create increasing difficulties for the US to fulfill its energy needs from traditional sources.

China and India, whose relations are sometimes troubled by border disputes, are warming up to each other. Analysts suggest that an agreement reached during the dialogues could preempt competition and conflict over oil in the future.

India and China are partners in Sudan's Greater Nile Project, but cooperation between the two may not come easily. Indian industry may seek to shy away from extending assistance to a nation some view as an economic rival during the ascendancy of the subcontinent's GNP.

These events come at a time when the United States recently announced its intention to help India, a past rival of China, become a "superpower." India has also been planning military expansion and modernization.