Reported on: May 29, 2012 09:26 AM
Reported in: International
New Delhi, May 29 (UNB) - India is jostling for space in energy-rich Myanmar, signing as many as 12 bilateral agreements Monday in an effort to play catch-up with well-entrenched rival China.
The agreements -- signed by a delegation led by Prime Minister Manmohan Singh -- covered areas as diverse as air services and agriculture, but one of the key developments was India-based Jubilant Energy getting a 77.5% interest in an onshore block.
Mr. Singh's three-day visit underscores India's "Look East" policy to deepen ties with countries in Southeast Asia and East Asia, including South Korea, Japan and Vietnam, as well as continue its search for oil and gas supplies to fuel its growing economy.
Myanmar could turn out to be a key source of energy for India, which has to import more than three-quarters of its crude-oil needs. New Delhi has been under U.S. pressure of late to cut its dependence on Iran, and it is looking for alternate sources to bolster its energy security.
Daiwa Securities estimates that Myanmar's oil and gas income is likely to rise significantly over the next five to 10 years.
The International Monetary Fund forecasts that Myanmar's gas revenue will rise to $3 billion this year and $4 billion in 2013. Gas exports, mainly to Thailand and eventually to China through a new pipeline, were worth $2.6 billion in the fiscal year through March.
India's Foreign Secretary Ranjan Mathai said Friday that New Delhi will be "emphasizing and flagging our interest in our companies getting more opportunities in Myanmar," both onshore and offshore.
India and Myanmar aim to double their annual trade by 2015 from the current $1.2 billion, which is currently heavily in favor of Myanmar with India's imports totaling $900 million each year.
Chinese companies have been in Myanmar for several years now in an effort to tap energy resources.
Others have come to the party as well: South Korea's Daewoo International Corp. is spending $1.7 billion to develop a natural gas field in Myanmar, but this supply, too, will be sold to China.
Mr. Singh's visit, the first by an Indian Prime Minister in 25 years, follows Myanmar President U. Thein Sein's tour of New Delhi last October.
It comes in the midst of a rush of world leaders to Myanmar after the country implemented several political reforms. British Prime Minister David Cameron visited recently, as did U.S. Secretary of State Hillary Clinton.
Myanmar was considered an exile state following decades of military rule, but elections in 2010 and the recent electoral win of democracy icon Aung San Suu Kyi has helped fast-track the restoration of its ties with the international community.
Mr. Singh's schedule includes a visit to Yangon to meet Ms. Suu Kyi, who was kept under house arrest for most of the past two decades.
India and Myanmar, formerly known as Burma, share a land border of more than 1,600 kilometers and a maritime boundary in the Bay of Bengal.
The two countries share long historical links as well: India's last Mughal emperor, Bahadur Shah Zafar, is buried in Yangon, while the encyclopedia Britannica of the early 1900s listed Myanmar as an Indian province.
The agreements signed Monday include an initial pact between the Export-Import Bank of India and Myanmar Foreign Trade Bank for extending a $500 million credit line.
Another agreement was signed to establish a rice biotechnology park at Nay Pyi Taw, Myanmar, to improve the food and income security of small farmers.
Another pact will seek to promote development in border areas, such as providing funding to open border bazaars to promote trade along the Indo-Myanmar border.
The air service agreement will give Indian carriers fifth freedom rights, allowing them to combine Myanmar with flights to other destinations in Southeast Asia.
A joint working group will also be set up to enhance rail connectivity and examine the feasibility of movement of freight from India to Southeast Asia, a move that has the potential to give a fillip to trade and investment in the region.
India and Myanmar agreed also to repair and upgrade a road linking Moreh in India's northeastern state of Manipur to Mae Sot in Thailand via Myanmar by 2016.