Sino‐Indian cooperation in the search for overseas petroleum resources

Abstract

PurposeIn the past few years Indian companies witnessed competition from their Chinese counterparts in acquiring overseas petroleum resources. In an attempt to avoid competition with each other the two governments have taken various measures, which finally led to the two countries signing a Memorandum of Understanding for energy cooperation especially for joint overseas bidding for exploration and production. Although the Indian side perceives the cooperation effort as a major breakthrough in avoiding Chinese competition in the overseas energy arena, it appears to be of limited prospects to India in terms of acquiring overseas petroleum assets or exploration and production contracts. The purpose of this paper is to examine the prospects and implication for India in the overseas energy cooperation with China.Design/methodology/approachThe paper analyses the strategy which China is pursuing, in order to maximise its gains and outmanoeuvre India in the overseas energy asset biddings.FindingsThe main findings of the paper show that competition would be the prevailing factor in their interaction in overseas energy search.Research limitations/implicationsWhile there are many potential areas of cooperation between India and China, this paper focuses only on their cooperation to jointly procure energy fields in order to evaluate the likely prospects and implications for India.Originality/valueThis paper is original work based on facts and information regarding energy cooperation between India and China. The paper offers an analysis of India‐China interaction in the overseas energy arena, and the prospects and implications of cooperation to India.