South Asian Integration

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Powering South Asian integration

Prelims level: South Asian integration

Mains Paper :GS Paper II– India and its neighborhood

Why in News?

Union Ministry of Power issued  (Guidelines for Import/Export (Cross Border) of Electricity, 2018) a seemingly anodyne memo that set the rules for the flow of electricity across South Asian borders.

 Guidelines for Import/Export (Cross Border) of Electricity, 2018:

  •  Facilitate import/ export of electricity between India and neighbouring countries;
  • Evolve a dynamic and robust electricity infrastructure for import/ export of electricity;
  • Promote transparency, consistency and predictability in regulatory mechanism pertaining to import/ export of electricity in the country;
  • Reliable grid operation and transmission of electricity for import/ export.

Significance:

  •  It leads South Asian electricity trade in progressive directions
  •  Also a concession to India’s neighbours in an area of political and economic importance.
  • First step towards the creation of a true regional market in which generators across the subcontinent compete to deliver low-cost, green energy to consumers.
  • Nepal and Bhutan have long recognized that their economic prosperity is tied to the sustainable use of vast hydro power reserves, similar to the oil based economic prosperity achieved by the Arab countries.
  • This is a crucial move towards the evolution of complex, multi-country market arrangements.

Concerns:

  • It seemed to be a reaction to perceptions of increased Chinese investment and influence in the energy sectors of South Asian neighbours.
  • India was enabling the incursion of foreign influence into neighbouring power sectors seem to have been replaced by an understanding that India’s buyer’s monopoly in the region actually give it ultimate leverage.
  • The South Asian grid system would mainly be located within the purview of Bangladesh, Bhutan, India, Nepal and therefore requires greater integration of energy deficient countries of Pakistan and Afghanistan and also for the ability of Sri Lanka to harness tidal and wind power to become part of a larger South Asian electricity grid system.

Source:The Hindu

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