Five South Asian Predictions for 2009 : A Biofuels Digest special report

by Joelle Brink, Biofuels Digest special correspondent

At the risk of life and limb, not to mention professional reputation, I have decided to hazard a few predictions (guesses?) about South Asia, biofuels and likely political conditions in 2009. They are all positive. That’s because beneath the turmoil a lot of good things happened in 2008.

Last year biofuels turned the corner from R&D to industrial scale. The government pumped two stimulus packages into an economy that is still growing and announced that if private sector banks refuse to lend, public sector banks will absorb their customer base. Many billionaire investors sold their stakes and began looking for medium to long range opportunities that will pay off when world economic growth returns. And though the government’s biofuel mandates were temporarily stalled by a drop in oil prices, proposals are on the table that would eliminate fuel subsidies and make biofuels competitive again.

Lastly, December’s human tragedy in Mumbai blew back on its perpetrators, revealing a terror network that had eluded exposure for decades. International intelligence efforts retrieved every word spoken between the ten terrorists, their handlers in Pakistan, and others higher up the chain of command, including names, locations and cell phone numbers. The new evidence also implicates Mumbai crime and drug lord Dawood Ibrahim, who has been living in Pakistan to escape prosecution in India for more than a decade.

So let’s look at what may happen in 2009.

1. Indian investment in biofuels will increase

This year there’s a lot of capital looking for opportunity, and many investors see their safest bet in the certainty that oil will run out. Last year’s scale jump at the production level began with a parallel jump in investment. Sun Microsystems founder Vinod Khosla kicked off the trend with his stake in cellulosic ethanol specialist Praj Industries, which is now building sweet sorghum ethanol distilleries for Tata Chemicals in India, and in other countries worldwide. Other Indian billionaires are now quietly joining the biofuel investors’ club. Expect Indian investment in US biofuels as well. Cell phone billionaire C. Sivasankaran recently set up “E85 Inc”, an ethanol producer in Raleigh, North Carolina.

2. The government of Prime Minister Manmohan Singh will be re-elected in May

Dr Singh, an eminent international trade economist and former Governor of the IMF, is one of the few people who can still get a loan-by-phone these days, and you can bet he won’t be paying for the call. He’s India’s greatest asset in these recessionary times and a strong advocate of biofuels and renewable energy.

3. India and Pakistan will not go to war

Apart from a few self-appointed “armies of the pure” on both sides of the border, and news outlets desperate for “a lead that bleeds”, nobody wants it, let alone wants to pay for it. India’s Muslim population is much larger than Pakistan’s and is second in size only to Malaysia’s. Should nuclear war break out, Pakistan would find itself on the wrong end of a formidable nuclear deterrent created by an Indian Muslim scientist, immediate past President of India Dr. A.J.P. Abdul Kalam. Fortunately biofuels researchers and producers on both sides of the border know that war is not an option and are working for the prosperity of the entire region.

4. More world-changing ideas from India

The past eight years have seen three disruptive technological revolutions from India—Dr. Sugata Mitra’s “Hole in the Wall”, which enables self-organizing groups of children with little or no access to education to educate themselves and obtain vocational credentials using shared public internet kiosks; Indian Railways’ biodiesel program, which provides additional income to thousands of farmers, has enabled the railroad to cut ticket prices to its poorest passengers, and inspired biofuel advocates around the world; and the “People’s Car”, the Tata Nano. All three began as deep cost-cutting exercises that required “out of the box” thinking, involved creative teams of young researchers and managers, and focused on meeting the needs of people struggling for inclusion in the nation’s economic growth. The conditions that produced these “nanolutions” as Tata calls them will increase over the next five years, as will the numbers of young professionals of a generation that is seeking to do good along with doing well. Fasten your seatbelts.

5. No No Nano for America in ‘09

Tata’s “People’s Car”, the Nano, recently bagged the Wall Street Journal Technology Innovation Award for Transportation, but it won’t make it to American shores this year. Meantime, it’s Go Go Nano for India and Europe, with a German FEV diesel-electric hybrid engine and a new French compressed air engine due out this year. The Nano’s design and many of its parts are sourced in Europe, and it is Euro IV emissions compliant. Tata Motors already has three European distributors lined up, but wants Nano to earn the highest Euro crash test rating before launching it overseas.

In order to bring Nano to the Americas, Tata would have to source parts here. It may get a chance this year in the restructuring of US automakers. Most automakers pay the bills during slow periods by building parts for other companies. Tata itself makes parts for Toyota and paints cars for Mercedes. Tata Motors has good relations with the US Big Three and they may be able to help each other. I’m betting on Ford, because it’s the home of the original “Nano”, the Model T, and Ford too has ties with Toyota.

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Five South Asian Predictions for 2009 : A Biofuels Digest special report

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