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The International Energy Agency (IEA), whose members are major energy consumers — mainly Japan, the United States and European nations — is set to start negotiations with India on its full membership.
It is hoped that the move will accelerate cooperation between developed countries and emerging economies toward stabilizing energy markets and realizing decarbonization.
The decision to hold negotiations was made at an IEA ministerial meeting in February.
India is the third-largest oil consumer in the world. With the major driver of global energy demand having shifted from developed countries to emerging countries in recent years, there has been a decline in the influence of the IEA, which is chiefly composed of developed countries. Consequently, India’s joining the IEA would have great significance.
India claims to be a leading power among emerging and developing nations, collectively called the Global South, and apparently aims to magnify its voice through international organizations.
Following the first oil crisis, the IEA was established in 1974 based on a proposal by the United States that major oil consumers cooperate to stabilize energy prices.
As of the end of last year, the IEA, which is set up under the Organization for Economic Cooperation and Development, had 31 member countries. If India joins the IEA, it will be the third Asian country to do so after Japan and South Korea.
IEA member countries are required to ensure oil stocks equivalent of 90 days of oil imports. In the event of an emergency, the member countries will release their stockpiles in a coordinated manner. In 2022, when crude oil prices skyrocketed due to Russia’s aggression against Ukraine, they made a coordinated release to keep oil prices down.
The participation of India is likely to enhance the effectiveness of such coordinated action and reinforce energy security for the member countries.
India’s membership is also expected to help promote the involvement of other emerging countries and advance global decarbonization.
Last year, the IEA set a goal of tripling global power generation from solar energy and other renewable energy sources from current levels by 2030. Cooperation with emerging countries will be essential to ensure the effectiveness of such measures against global warming.
India relies on coal-fired power generation. If it becomes an IEA member, India is likely to find it easier to obtain technical cooperation on renewable energy from developed countries.
It is hoped that India’s full membership in the IEA will encourage other emerging economies to join international rulemaking efforts and increase the momentum for decarbonization in a responsible manner.
Countries such as Japan, the United States and France have already expressed their support for India’s membership, but some challenges do remain in the negotiations.
Currently, India’s oil stockpiles are said to amount to less than 10 days of net imports, so it will have to increase its oil stocks to the 90-day level once it joins the IEA. In addition, membership in the OECD is a precondition for becoming an IEA member, but India reportedly does not want to join the OECD. This requirement for IEA membership will also need to be reviewed.
It is hoped that the countries concerned will hold discussions and quickly find common ground.
