India finds cheap energy may be an easy nut to crack

India, which imports more than 70 per cent of its oil and gas, is trying to launch one of the world’s biggest jatropha biofuel projects in order to bolster energy security. The country’s Ministry of Rural Development has proposed spending $375m (
Chhattisgarh, carved out of the poor neighbouring state of Madhya Pradesh in 2000, hopes to generate 1,000MW, or a third of the state’s existing generating capacity, from alternative energy sources by next year.

The state has planted 160,000 hectares of jatropha. Further planting could by 2012 yield an annual 2m tonnes of biodiesel. Shailendra Shukla, director of Chhattisgarh Renewable Energy Development Authority, says that with the non-arable land available, “if all other states replicate this, it will change the economy”.

Such confidence in jatropha, still untested on a large scale, may be unwise in a country notorious for ambitious plans and poor implementation. Energy, however, is one of the most pressing issues for India: on the back of annual economic growth of nearly 9 per cent, energy consumption is expected to double between 2005 and 2030, according to the International Energy Agency. India paid as much as $60bn to import crude oil last year.

“The whole economy of India is damaged because of crude oil,” says Mr Shukla, when asked what spurred him to look at jatropha in 2004, when he made an initial test batch of 100 litres. “If we are increasing consumption of oil, we are benefiting Arab people, not the Indian economy.”

Financial Times