Ivanka Trump, daughter and adviser of President Donald Trump, gestures while speaking during the inauguration of the Global Entrepreneurship Summit 2017 in Hyderabad, Nov. 28. (Shailendra Bhojak/PTI)
The month of November was marked by the arrival of Ivanka Trump to India as head of a U.S. delegation to the eighth annual Global Entrepreneurship Summit held in Hyderabad. Prime Minister Narendra Modi hosted the fashion-conscious entrepreneur daughter of President Donald Trump to a lavish dinner at the splendid Taj Falaknuma Palace. Ivanka praised Modi’s efforts “to build India as a thriving economy, a beacon of democracy, and a symbol of hope to the world,” writes Siddharth Srivastava.
“Modi has proven that transformational change was possible through his own example, from selling tea as a child to becoming PM, and was now bringing that promise to hundreds of millions of people across your country,” Ivanka said.
Modi said he was not content with the 100th rank that India secured in the World Bank’s ease of doing business list due to the various reforms implemented in the past three years. India needs to work toward breaking into the top 50, he said.
Referring to steps taken to tackle tax evasion and black money, Modi said, “Our efforts have been recognized by Moody’s recent upgrade of India’s government bond ratings. This upgrade comes after a gap of almost 14 years.” Having doubled renewable energy capacity to 60,000 MW, India is now working to develop a national gas grid, Modi said. “A national energy policy is in the pipeline.”
The month of November was marked by another significant import from USA, though not of a very glamorous variety. India’s coal imports from North America, that is supplies from America and Canada, have tripled to 2.1 million tons in October from a year ago, Reuters has said quoting available shipping data.
Coal imports stand about 1.5 million tons from November 1-20, which is already more than 70% of last month’s purchases. It may be recalled that recently, India, the world’s third-biggest oil importer, joined Asian countries such as South Korea, Japan and China, which have also been purchasing U.S. crude.
It has been some years now that India has been unhappy about it’s overwhelming dependence on West Asian crude oil and gas imports. The occasion to import U.S. crude arose this year for India, after the discount for West Texas Intermediate (WTI), the benchmark for U.S. crude, to global benchmark Brent, that serves as a reference price for buyers in the West, stretched to its widest since 2015.
The total volume of the crude presently contracted by Indian State refineries is 7.85 million barrels. The U.S. embassy in India said that crude oil shipments to India have the potential to boost bilateral trade by up to $2 billion. Indian entities are also contracted to purchase 5.8 million tons per annum of liquefied natural gas (LNG) from USA that is expected to start arriving in the near future.
Though there is some divergence in figures quoted by other sources, India’s coal imports from North America are also likely to surge as buyers are looking to boost purchases due to domestic shortage and a regional ban on petroleum coke, Reuters quoted unnamed traders and cement company officials. “Every cement company is looking for an alternative to petroleum coke, and all of them are scrambling for U.S. coal,” an unnamed senior executive from one of India’s top three cement companies was quoted to say. Currently, the Supreme Court has banned use of petcoke in Rajasthan, Uttar Pradesh and Haryana to curb pollution in the National Capital Region. Restrictions are likely to be extended across the country very soon.
Cement companies account for nearly 75 percent of India’s annual petcoke demand of 27 million tons. Substituting with domestic coal is not easy due to procurement issues. In a note Edelweiss Securities has said, “The coal available is of a grade which can be used only for captive power plants and is not suitable for use in kilns.” The petcoke ban could be a setback to Modi’s plan to reduce India’s coal imports to cut foreign exchange outflows, especially with oil prices creeping up. Overseas purchase of coal have risen for the first time in the last two months after falling past few years. However, in a report, ratings agency Fitch said India’s imports of thermal coal will drop due to Modi’s big push for renewable energy.
India plans to install 175,000 MW of renewable energy capacity by 2022 that will include 100,000 MW solar and 60,000 MW wind. The government recently released a detailed roadmap for auction of wind and solar projects over the next five years to achieve the target.
“We expect India’s thermal coal imports to continue to fall as the government maintains its push for self-sufficiency and as renewable energy output increases,” Fitch said. Oil, gas, coal and Ivanka, the U.S. is making its presence felt in India in more ways than one. Former President Barack Obama too was recently in New Delhi for a conference. The spotlight, however, was on Ivanka.