New Delhi, August 14: Australia should position India at the center of its regional strategy to enhance trade, energy, and infrastructure integration in South Asia, according to a new report by the Lowy Institute, a policy think tank in Australia.
The report suggests that Canberra should initiate the second phase of its comprehensive strategic partnership with India, aimed at strengthening bilateral renewable energy collaboration.
Under the existing partnership, there has been significant growth in bilateral trade, defense relations, and renewable energy cooperation between India and Australia.
The proposed new initiative should place India at the heart of the South Asia Regional Infrastructure Connectivity (SARIC) strategy. This would promote collaboration in solar energy supply chains, hydrogen, energy storage, investment, and workforce skill development.
The report states, “A project preparation window centered on India should be established within the renewed SARIC. Governments involved could propose cross-border projects, starting with the Bangladesh-Bhutan-India-Nepal subregion.”
The Lowy Institute emphasizes that Australia should view New Delhi not just as a bilateral partner but as a central figure in the regional future of South Asia, given India’s economic strength and geographical position.
According to the report, India could lead technical coordination through its power grids and transportation systems, while Australia could provide financial assistance for feasibility studies, regulatory frameworks, procurement processes, and environmental and social safeguards.
Once project preparations are complete, funding could be made available from the World Bank, International Finance Corporation (IFC), and other development banks.
The SARIC program, funded by Australia and operated with the World Bank and IFC, was a AUD 32 million initiative from 2019 to 2024. It operated in Bangladesh, Bhutan, India, the Maldives, Nepal, and Sri Lanka, assisting governments in preparing transport and energy projects that could attract public or private investment. Additionally, professional training was provided for project implementation.
The report prioritizes electricity trading, suggesting that SARIC could help develop grid rules that ensure coordination between different countries’ systems. It could also facilitate viable power purchase agreements, shared energy storage, and electricity balancing arrangements.
Later, this initiative could assist in developing transport corridors for clean energy equipment around the Bay of Bengal.
The report concludes, “Australia does not need a new large infrastructure fund until it has a reliable pipeline of projects. It should revive a proven mechanism. India can provide scale, geographical positioning, and leadership, while SARIC can offer institutional frameworks.”
– D.S.C.
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