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India and Pakistan relations: electricty may bring them together


India plans to sell 500 megawatts of power to Pakistan. Officials of the two countries are scheduled to meet in December to finalize the tariff and grid connectivity, reported the Indian newspaper, The Telegraph. India and Pakistan have reached a formal understanding on the sale of electricity. The finer details still need to be finalized. Electricity trading with Pakistan is part of a larger plan for a South Asian transmission link which will help countries in the subcontinent to harness energy.

The sale of electricity to Pakistan will help reduce the country’s outages. The officials indicated that both countries are considering setting up transmission infrastructure in a joint ownership. Lahore in Pakistan has complete transmission lines and grids, which is near the grid in Punjab in India, so it would be economical to transfer power through Amritsar.

There is a political will among the leaders of both countries to enhance trade ties. South Asian electricity trade is being seen as a major area of cooperation among countries that will bring increased prosperity to the subcontinent by providing power to the deficit parts of the region. South Asia is a major global hub, having 25% of the world’s population.

There is an ongoing shift in focus from agriculture to manufacturing in South Asia. Currently, no South Asian country can fully meet its energy needs from within its own domestic resources. Integrating South Asia with a robust power grid is the ultimate goal.

India will need about 250,000 megawatts of power by 2017, a fivefold increase on its current requirements, to sustain its economic growth. A South Asian grid will give the region 100,000 MW to trade and help India tap hydropower and natural gas reserves of its neighbours.

The grid model connecting Norway, Denmark, Sweden and Finland – and another linking South Africa, Botswana and Zimbabwe – are being studied in order to provide the best system for South Asia.

The electricity and energy cooperation are non-traditional areas of trade development. Bhutan has managed to balance its trade with India with large exports of hydro-electric power. Similar potential exists for Bangladesh and Nepal.

An integration of electricity grids across South Asia will reduce power costs and enhance manufacturing competitiveness. Nepal, Bhutan, Afghanistan and India have huge hydro-electric potential which can be tapped for intra-regional power trade.

A transmission link with Bhutan is currently in place. There are plans to tweak the existing line to enable imports of up to 5,000 MW into India by 2020. New Delhi is setting up a link with Bangladesh. Plans are also underway to establish a transmission link to exchange upt to 1,000 MW with Sri Lanka.

Martina Nicolls is the author of Kashmir on a Knife-Edge
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