Australia eyes Indian energy market

Australian minister for trade Warren Truss has said that India should look at Australia as a long-term supplier in the area of energy and resources.

Opening the Australian Consulate General in Chennai, Truss said, "India's projected energy and resources requirements are enormous. It is already the world's sixth largest energy consumer, and demand for oil, gas and coal is surging. With 5 percent of the world's black coal reserves and 19 percent of proven reserves of LNG in the Asia-Pacific region, Australia is an ideal resource supplier for India."

While current LNG trade between the two countries has been mainly through spot sales, there is strong interest in Australia to become a long-term LNG supplier to India, Truss said, adding, "It would be wrong to ignore this potential."

Both countries are currently members of AP6 (Asia-Pacific Partnership on Clean Development and Climate) and Australia has been testing technology to capture and store carbon dioxide from power plants through AP6 countries.

"This will make power stations more efficient by burning less coal and emitting less carbon dioxide. Such a technology will benefit India, which will depend on coal for many years to come. It will also benefit exporters like Australia, as well as the world's climate," Truss said.

Noting that two-way trade between the two countries is now in excess of US $9.45 billion (Australian $12 billion), he said that India had become Australia's seventh largest export destination.

"The momentum is building so strongly in our economic relationship that it is creating a playing field beyond just cricket. Trade is the new game in town," Truss said.

"Growing trade in sectors like resources, education, tourism, IT services, construction and agri business are contributing to the momentum in our economic relationship." Besides the manufacturing, banking and IT sectors, Australia is also assessing opportunities in India's food industry.

Truss said that nearly 39,000 Indian students enrolled in Australian educational institutions last year, making it the number two destination for Indian students after the US. Indian tourist arrivals to Australia grew by 23 percent in 2006.

He noted that the Nokia plant in Chennai was built by Leightons Australia which would soon start work on the Motorola plant on the city's outskirts.

The Indian economy is poised to grow at 9 percent for the second consecutive year, and by some estimates, could become the world's second largest economy by the middle of this century, Truss said.