India is experiencing some of the greatest structural changes as bold new reforms like note ban and GST have put the country firmly on a sustainable growth path, oil cartel Opec's Secretary General Mohammed Barkindo said on Tuesday.
Speaking at the India Energy Forum by CERAWeek, he said the country's expanding middle class represents a growing source of demand, not just for energy but for goods and services from around the world.
"India's economy has been experiencing some of the greatest structural changes in a generation. A slate of bold new reforms, embarked upon under the visionary leadership of Prime Minister Modi, has put the country firmly on a sustainable dynamic growth path particularly when it comes to energy," he said.
Reforms, including demonetisation policy, the Goods and Services Tax (GST), and efforts to diversify the energy mix have all been designed to move the country toward sustainable growth and stability, he said.
He further said that with major growth in transportation sector, expansion in exports of numerous goods and services, world-renowned IT sector, a strong services sector and solid manufacturing base, India has undergone a great economic transformation and its role in the global marketplace, as well as involvement in international trading networks, are admired signposts.
"At Opec, we have been paying close attention to these macroeconomic and business trends in India. Some of them shall directly benefit the growing populations of Opec's own member countries," Barkindo said.
In particular, he said, Opec is working to better understand the potential impacts that such beneficial economic changes may have on future oil demand.
"Opec even sees world oil demand growth increasingly shifting to India. We anticipate that by 2040, India's oil demand will increase by more than 150 per cent to 10.1 million barrels per day from around 4 mbpd currently," he said.
The country's total share of global oil demand is also seen rising to over 9 per cent by 2040 from 4 per cent now.
"There are many factors helping to foster, strengthen and support the deepening relationship between Opec and India," he said.
During 2000 to 2015, India's imports from Opec nations increased from $2 billion to nearly $140 billion. Opec countries' imports from India increased from $5 billion in 2000-2001 to $56 billion by 2015.
"In terms of crude oil, what we see is similarly impressive in terms of growth. India's total imports have risen to close to 4.3 mbpd in 2016 from around 1.5 mbpd in 2000. Nearly 80 per cent of these total imports came from Opec member countries," he said.
This has been because of demand in India, which last year was the fastest in the world, with an increase of close to 340,000 barrels per day or 8.3 per cent.
India currently is the world's third-largest oil consumer.
"Along with other oil producers, we have all seen that constructive dialogue and flexible cooperation can play an important role in maintaining stable oil markets," he said.