ASEAN to gain if India-China energy partnership succeeds

ASEAN to gain if India-China energy partnership succeeds

Agence France-Presse
Singapore

Southeast Asia stands to gain if regional powerhouses India and
China succeed in jointly securing long-term energy supplies to
fuel their fast-growing economies, analysts said.

The two former rivals are now key trading partners of
Southeast Asia and if they can work together to ensure their
energy needs are met, it will mean a continuation of the sizzling
growth that has benefited the region, they said.

"We in Southeast Asia would certainly like to see the
continuous growth in China and India," said Rodolfo Severino, the
former secretary-general of the 10-member Association of
Southeast Asian Nations.

"If they are able to resolve their concerns over energy, then
that means their rapid growth will continue, which is good for
the region," he told AFP by telephone.

China and India plan to sign pacts in November aimed at
teaming up to bid for oil and gas projects, the latest signal yet
that ties are improving after a history of hostility which saw
the neighbors fight a brief border war in 1962.

The two neighbors had been vying for scarce energy resources
around the world with Beijing winning the latest bout when China
National Petroleum Corp. outbid India's Oil and Natural Gas Corp.
for Kazakhstan's third-largest oil producer, PetroKazakhstan.

Both countries are keen to ensure there is enough oil to power
their rapidly growing economies. Demand from China and India is
one of the reasons behind the sharp rise in crude prices over the
last two years, according to oil dealers.

Cooperation between the two Asian giants in securing energy
supplies can only be favorable for Southeast Asia, said Hugh
White, a professor of strategic studies at the Australian
National University in Canberra.

"Obviously for both countries, the search for energy security
is going to be one of the key drivers for their strategic
policies," White told AFP.

"If that search for energy security is mishandled, it could
lead to significant insecurity and it is particularly important
for Southeast Asia.

"It is the part of the world in which the spheres of interest
of the two countries most naturally overlap and is also
potentially a significant source of energy itself," he said,
adding that Southeast Asia is also a crucial transit area for oil
shipments.

The narrow 960-kilometer long Malacca Strait in Southeast
Asian waters is one of the world's busiest trading routes, used
by about 50,000 ships a year carrying a third of global trade and
half its oil supplies.

The ADB cut its GDP forecast for Southeast Asia to 5.0 percent
in 2005 due to poor harvests in the Philippines and Thailand, a
cyclical downturn in the global electronics sector and higher oil
prices.