At energy diplomacy, there is now a yawning gap between the UPA government?s self-assessed performance and a more dispassionate scorecard. The world?s quest for energy security is intensifying. But while the government is still given to quietly patting itself on the back for the Indo-US nuclear deal, something it wants seen as an A-class success despite the jinx in the domestic arena brought on partly by its evasiveness on India?s intended role in the larger geopolitical framework, a less gung-ho analysis would give it no more than a ?D?, if not an outright ?E? grade. This is not just for the government?s naive mismanagement of a deal that has been the talk and envy of the world (largely for conferring special benefits on India), but for letting its attention on other resources slip, and thus letting risks multiply. The hydrocarbons initiative, once full of promise, suddenly looks shaky. The latest fiasco, as reported by FE on Monday, involves ONGC Videsh?s search for offshore deepwater hydrocarbons in a couple of blocks in the South China Sea for which the company had won contracts from the government of Vietnam in 2005-06 and signed an allied production sharing deal with its state oil company, Petro Vietnam. Some $100 million by way of investment had already been committed to the exploration project, and now it turns out that these are disputed waters, and that, too, with China as the disputant.
As China glares at Indian activities in the area, ONGC must not only ask itself how it ended up in disputed waters in the first place, but also formulate a course of action consistent with obtaining the best outcome under the circumstances. India, no doubt, can produce a docket of papers to substantiate the legitimacy of its exploration, but China does not have a glowing record of paying attention to such details in matters of vital interest so close to its territorial waters. Of course, China?s sudden display of interest in the two blocks suggests a revaluation on its part of their hydrocarbons potential. Also, ONGC is already on the job. In all, India need not underestimate its bargaining position. Some deft diplomacy is called for. World sensitive sections of the Indian electorate would be watching, so do not ignore the national prestige stakes. Being led purely by on-the-table arithmetic could prove pyhrric.
