Economic importance of Indian Ocean Region

The Indian Ocean matters today, arguably more than ever. It is a major conduit for international trade, especially energy. Its littoral is vast, densely populated, and comprised of some of the world’s fastest growing regions. The Ocean is also a valuable source of fishing and mineral resources. The Indian Ocean basin is of particular importance for India, as the region’s most populous country and geopolitical keystone.

The Economic importance of IOR for India includes:

Trade and Commerce:

1. It enjoys a privileged location at the crossroads of global trade, connecting the major engines of the international economy in the Northern Atlantic and Asia-Pacific. This is particularly important in an era in which global shipping has burgeoned.
2. Today, almost 90,000 vessels in the world’s commercial fleet transport 9.84 billion tonnes per year. This represents an almost four-fold increase in the volume of commercial shipping since 1970.
3. The Indian Ocean has vital sea lanes of communication crisscrossing it and which feeds Asia’s largest economies. Around 80 per cent of the world’s seaborne oil trade passes through the choke points of this ocean and therefore it literally connects the east to the west with 40 percent passing through the Strait of Hormuz, 35 percent through the Strait of Malacca and 8 percent through the Bab el-Mandab Strait.
4. The Ocean’s vast drainage basin is important in its own right, home to some two billion people. This creates opportunities, especially given the high rates of economic growth around the Indian Ocean rim, including in India, Bangladesh, Southeast Asia, and Eastern and Southern Africa.
5. 95 per cent of India’s trade by volume and 68 per cent of trade by value come via the Indian Ocean.
6. Presence of 13 major ports and over 200 minor ports provide avenues for exports of Indian goods to world.
7. Blue Economy: The Indian Ocean is rich in natural resources.

Oil and Natural Gas:

1. Forty per cent of the world’s offshore oil production takes place in the Indian Ocean basin.
2. Energy security and resources are absolutely critical. The Indian Ocean Region is immensely rich in that.
3. 28 million barrels per day—or nearly 80 per cent of India’s crude oil requirement—is imported by sea via the Indian Ocean. Taking into account India’s offshore oil production and petroleum exports, India’s sea dependence for oil is about 93 per cent, according to the Indian Navy.
4. India is also the fourth-largest importer of liquefied natural gas (LNG), with about 45 per cent coming by sea.
5. India has her own oil rigs in the Indian ocean region. Example: Bombay high

Minerals:

1. Mineral resources with nodules containing nickel, cobalt, and iron, and massive sulphide deposits of manganese, copper, iron, zinc, silver, and gold present in sizeable quantities on the sea bed.
2. Indian Ocean coastal sediments are also important sources of titanium, zirconium, tin, zinc, and copper.
3. Additionally, various rare earth elements are present, even if their extraction is not always commercially feasible.
4. In 2014, the International Seabed Authority issued licenses for the Indian Ocean ridge, opening up new opportunities for deep seabed mining. This region is estimated to have massive reserves of manganese, as well as cobalt, nickel, and copper, all of which are scarce on Indian soil.

Placer Deposits – Vitally important, thorium resources in placer sands of Malabar coast are a promise to Nuclear Energy security. Similarly Placers of Thailand, Indo-China and Australia are source of precious heavy metals critically important for Electronics and semi conductors industry.

Fishing and Aquaculture:

1. Fishing in the Indian Ocean now accounts for almost 15 per cent of the world’s total.
2. Aquaculture in the region has also grown 12-fold since 1980. Although global fishing is reaching its natural limitations, the Indian Ocean may be able to sustain increases in production.
3. The largely unregulated overexploitation of its fishery resources. The consequences of over fishing, which is actually largely a result of activity by countries outside the region, could eventually have serious consequences for littoral states that depend heavily on maritime resources to feed their populations and also provide valuable export revenues.
4. India captured 4.1 million tonnes of fish in 2008, placing it sixth in the world and its fishing and aquaculture industries employ some 14 million people.
5. Fisheries and aquaculture industries are also a major source of exports. India’s maritime exports grew 55 times in volume between 1962 and 2012 and fisheries exports now account for Rs. 16,600 crore or about $2.5 billion.
6. Tourism:
7. Coral atolls in Lakshadweep, Andaman & Nicobar Islands attract many tourists from India as well as abroad. This helps the livelihood of many islanders.

Conclusion:

 Indian Ocean is an “ocean of economic opportunities” for India. The security threats posed by State and non-state actors are impeding the progress. The Government initiatives like SAGAR, IORA, Sagarmala etc. should ensure that the fruits of Blue Economy is well reaped.