Indian cos hope to tap Australian energy resources if FTA sails through
The Hindu Businessline | 30 August 2009
Indian cos hope to tap Australian energy resources if FTA sails through
Anil Sasi
New Delhi, Aug. 30 — At a time when Indian utilities are scrambling for securing energy assets abroad, easier access to Australia’s vast natural resources could be among the possibilities for domestic companies, if the proposed Foreign Trade Agreement (FTA) between the two countries sails through.
Indian companies, which have aggressively begun hunting for overseas mineral resources, led mainly by coal and natural gas assets, could get a better footing Down Under as trade engagements pick up further. For Australian companies, the prospect offers greater access to the Indian market for agri-products and dairy items, mining resources and climate change technologies.
Uranium sales from Australia to India are, however, ruled out for now.
“On the FTA, at the moment we’re coming to the end of the feasibility study, which has been quite positive from both sides… The expectations of a successful FTA are quite strong. Negotiations are likely to commence early, possibly by the end of this year,” Australia’s Senior Trade Commissioner, South Asia, Mr Peter Linford, said.
India is already the fourth largest market for Australia, and the exchanges could be stepped up if the proposed agreement goes through.
“A greater proportion of trade value between the two countries is through commodities such as coal and gold, and food and textile raw material products… Energy is probably one of India’s greatest challenges. And Australia is one of the leading countries in terms of the ability to supply quality coal,” Mr Linford, who in June last year assumed the role of Senior Trade Commissioner for the region, told Business Line.
Resources and energy needs are attracting the most investment from Australia to India, he said.
“Increasingly, this list is diversifying and we are seeing strong growth in the number of Australian companies doing business with India across industry sectors, especially with food and beverage as well as the service sectors… We are also seeing investments in IT, tourism and hospitality, fertiliser sector and education facilitation,” he said.
Petronet LNG Ltd, India’s largest liquefied natural gas importer, has already tied-up a mega deal to import 1.5 million tonnes of the fuel from the Gorgon project in Australia earlier this year. Besides, firms such as NTPC Ltd and Coal India Ltd are also scouting for the possibility of securing coal assets in Australia.
Minerals such as gold, copper, phosphate and magnesium are also generating strong interest from India in Australian resources. Besides, there is an increasing degree of interest in services sector, including education, finance, legal and wealth management, he said.
He also said that the recent decision by India to allow import of dairy products from Australia was “very encouraging.”
“Australian dairy companies will look out for partnerships, even though it is still early stages,” he said.
