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Transcipt of Remarks
the Honourable Joe Oliver, P.C., M.P.
Minister of Natural Resources
Luncheon with the Federation of Indian
Chambers of Commerce and Industry
October 8, 2012
Good afternoon everyone. First of all, let me say how delighted I am to be here in India. Although I have visited your beautiful country several times, I’m proud to be here today on my first official visit as Canada’s Minister of Natural Resources. I want to thank the Federation of Indian Chambers of Commerce and Industry for the honour of addressing some of the top business leaders in this country, leaders who are driving India’s great economic rise.
The ties between our two great countries are steeped in rich history and rooted in close friendship. We’ve fought together in times of war and worked together in times of peace. We share key attributes: parliamentary democracy, membership in the Commonwealth, a common legal tradition and open and entrepreneurial economies. Close to one million people of Indian descent now call Canada home. Currently, there are 23,000 Indian students studying in Canada.
The rapid emergence of India as a global economic powerhouse is only just starting to be reflected in the growing importance of the economic relationship between our countries. In 2011, our bilateral trade reached $5.1 billion, and two-way investment totalled $5 billion. In the last year alone, Canadian exports to India increased by over 27 percent, and our imports from India were up by more than 19 percent.
Ensuring that our friendship continues to develop, while these numbers continue to grow, is a priority for Canada. In that regard, you may have noticed that we Canadians have been spending a lot of time in India. Since 2006, federal government ministers from Canada have visited India more than 20 times, and provincial premiers have visited six times.
In 2009, Prime Minister Harper travelled to India to meet with Prime Minister Singh and to announce, among other things, a Joint Study group to formulate parameters for a Comprehensive Economic Partnership Agreement. In launching these talks, our Prime Ministers committed to tripling annual bilateral merchandise trade to $15 billion by 2015. This past summer, we concluded the fifth round of negotiations toward this important agreement to encourage greater freedom of trade and commercial relations between our countries.
These negotiations continue to be a great step forward in our bilateral relations. In a testament to the blossoming relationship between our two countries, Prime Minister Singh travelled to Toronto for the G-8 Summit and for the first bilateral visit of a sitting Prime Minister of India to Canada in 37 years. Our Prime Ministers welcomed the signature of the Agreement for Cooperation in Peaceful Uses of Nuclear Energy and the signing of a Memorandum of Understanding on Earth Sciences and Mining. We have also recently concluded negotiations for a Foreign Investment Promotion and Protection Agreement and are looking forward to a joint announcement in the near future.
This high-level relationship, combined with visits by government officials and business delegations, is expanding bilateral ties between India and Canada, improving mutual understanding and encouraging closer cooperation.
Opportunities for Growth
So, the ambitious trade goals committed to by our Prime Ministers are achievable. As growth in India continues, resources such as coal, gas and oil, minerals, metals and wood products will all be in demand. And Canada can provide a great deal of what India needs. Last year, over half our exports to India consisted of these natural resources. Still, I believe we have barely scratched the surface.
Global Energy Demand
Global energy demand is expected to increase by 40 percent from 2010 to 2035, and Canada is well-positioned to support that demand. The International Energy Agency estimates that non-OECD countries will account for nearly 90 percent of the world’s growth in energy demand. Indeed, China is expected to consume nearly 70 percent more energy than the United States by 2035, while energy consumption in India, Indonesia, Brazil and the Middle East is expected to grow even faster.
The result is that global oil demand is projected to increase to 99.4 million barrels per day, with 60 percent of this demand coming from non-OECD countries. This forecast has huge implications for global energy demand as fossil fuels, with the result that coal, oil and natural gas are expected to remain the dominant source of the world’s energy for the foreseeable future, accounting for 75 percent of global energy consumption by 2035.
Global Energy Supply
Of special significance is the fact that 58 percent of the expected growth in world oil production will come from unconventional sources between 2010 and 2035.
North America is now the fastest-growing oil-producing region outside of OPEC. Increased production from North American oil sands, tight oil formations and shale gas will have significant implications, one of which is to reduce the need for oil imports from less stable regions of the globe and thereby enhance energy security. For Canada, this means the need for new markets for our enormous and growing supplies of energy resources.
A central message I want to convey is that Canada’s enormous energy potential creates a great complementarity of interests for our two countries.
India is now ranked as the fourth-largest energy consumer in the world. And it is looking to quintuple its energy supply within the next 25 years to meet a daunting 8 percent energy supply gap, with peak shortages running as high as 12 percent. India’s supply challenges are both acute and looming. Indeed, many experts predict that the coal reserves India relies on to power its economy will run out by 2050. For all these reasons and more, India is seeking diversification of supply to provide greater energy security to fuel its dynamic growth.
And Canada is ready to help. Our proven oil reserves are the third-largest in the world, with 173 billion barrels, of which 98 percent, or 169 billion barrels, are oil sands. With new technology, oil sands reserves could grow to 315 billion barrels, giving Canada the largest oil reserves in the world. Shale oil development could generate billions more.
As one of the world’s largest importers of liquefied natural gas, India has a special interest in Canada, the world’s third-largest gas producer. Canada has up to 1,300 trillion cubic feet, or 37 trillion cubic metres, in natural gas resources, representing a significant supply to meet India’s growing demand for years to come. This number will undoubtedly increase as we discover more shale gas and offshore resources.
One of the challenges facing Canada has been building the infrastructure needed to meet growing global demand. But that’s about to change with the development of ports and liquefaction facilities on the Pacific coast of British Columbia. The first of these export facilities could be loading liquid gas onto trans-Pacific tankers within a few years. The potential for exporting liquefied natural gas from our East Coast is also under discussion, and we welcome India’s interest in pursuing these export opportunities from Atlantic Canada.
For Canada, new liquefied natural gas export projects mean opportunities to open new markets. For India, they can mean a safe and reliable source of LNG for decades to come.
We can also help broaden India’s energy mix with other energy resources. Canada is one of the world’s largest producers of uranium, and we’re committed to negotiating the Administrative Arrangements of the Nuclear Cooperation Agreement on the peaceful uses of nuclear energy announced by our Prime Minister’s in 2010 — a fundamental step in shared secure and beneficial nuclear cooperation and trade.
Other clean energy technologies can help India meet its growing power demands, spurring development while safeguarding the environment. Under the Canada–India Energy Forum, we are strengthening our energy partnerships and providing Canadian expertise in a wide range of areas, including clean coal technologies, smart grids, energy efficiency and the generation and distribution of hydroelectricity, at which Canada is an expert.
Our potential contribution to India’s growth goes beyond energy resources. India’s rapidly expanding middle class is hungry for consumer goods, cars and infrastructure, all of which require minerals and metals.
Earlier this year, India noted that it will require over $1 trillion dollars in infrastructure financing by 2017 to realize these enormous economic opportunities. As one of the world’s leading mining nations, Canada produces more than 60 minerals and metals. We rank at the top of the global production of many key commodities, such as potash, nickel, gold, zinc and uranium.
Our mining companies are among the best in the world and can provide key expertise and investment to support the growth of mining here in India. Pebble Creek Mining Ltd. and Balaton Power Inc. are two examples of Canadian junior exploration companies with mining leases in India. They’re considering prospects for gold, copper, silver, diamonds and precious and base metals.
As India looks to further develop its mining assets, Canada stands ready to help. We have expertise to share in all areas of mining, from mine design, extraction and processing to mine closure and rehabilitation. And, importantly, we have a world-leading cluster of financial, legal, geoscience, technology and engineering firms supporting Canadian and international industry around the world. In that regard, Canada encourages India to continue its progress to ensure market access and greater regulatory clarity and certainty.
Progress on these fronts would encourage more Canadian businesses to provide India with state-of-the-art equipment, services and technologies that can boost productivity and environmental performance in the extractive sector.
There is also an increasing need for forest products in India, driven by a rising demand for housing. In 2011, exports of Canadian forestry products to India totalled $403 million, an increase of more than 141 percent since 2001. We are working closely with industry and with British Columbia (Forestry Innovation Investment) to explore new opportunities to expand our trade in forest products and, in particular, to promote the benefits of Canadian tree species and wood products in this vibrant market.
These efforts have already borne fruit, with significant investment in Canadian pulp mills by Indian companies. The Aditya Birla Group recently acquired a majority stake in two New Brunswick mills. The company’s Canadian operation, the AV Group, was granted $36.4 million in funding under the Government of Canada’s Pulp and Paper Green Transformation Program.
Another important area has been science and technology. Sixty-five years ago, we started working to promote industrial cooperation on science and technology. Our partnership was formalized with the Canada–India Agreement for Science and Technology Cooperation in 2005.
As I mentioned, we have numerous Memoranda of Understanding partnerships in place, from geomatics and spatial information to earth sciences, mining and energy. These agreements help foster our bilateral dialogue and knowledge sharing on a range of areas, from mining and energy to remote sensing, which has helped to monitor natural disasters, like landslides, and has improved agricultural practices. For example, in West Bengal, Canadian and Indian geologists worked together to uncover the cause of high arsenic levels in the local soil and water supply. That’s just one example of how our partnerships are improving people’s lives in both our countries.
From science and technology to energy, mining and forestry, our partnership is helping India to unlock its extraordinary promise. Looking to the future, the picture keeps getting better.
Over the next 10 years, as many as 600 projects, worth more than $650 billion, could come on stream in Canada. No other country in the world is bringing on natural resource investments of this scale or at this pace, creating an unparalleled opportunity for investors.
This is why we recently launched our plan to modernize our regulatory system, called Responsible Resource Development. It will ensure that Canada's regulatory regime for major projects is among the most efficient, effective and competitive in the world. This new legislation eliminates duplication and enforces beginning-to-end time limits on environmental assessments. It also strengthens environmental protection by focusing on major projects and bolstering enforcement. It enhances consultation with Canada’s aboriginal peoples in order to ensure that their economic and social interests are taken into account. We’re taking these measures to unlock an immense investment potential that means jobs and growth right across Canada and opportunities for foreign investors.
My central message therefore is this: India and Canada have mutual interests that can make for an exceptionally productive long-term strategic partnership in trade and investment. It’s time to redouble our efforts to reap the full benefits of our relationship. Unlocking these enormous opportunities will require the energy of everyone here in this room, as well as that of many others in both our countries.
This can be an important moment in our relationship. By working together, we can advance the prosperity and opportunity of the people of India and Canada for generations to come.
Thank you. Namastay.
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