India, Pakistan, Bangladesh and Nepal are together home to nearly two billion people, about 23 percent of the world’s population. Even before the war on Iran, the region depended heavily on imported energy, much of it from Gulf countries. But the extent and nature of exposure of different South Asian countries to Gulf supplies and the Strait of Hormuz varied significantly.
Now, they are all feeling the effects of the prolonged and expanding war, as more and more supply routes become choked. India imports about 85 percent of the crude oil it consumes – it is the world’s third-largest crude importer. Before the war, Gulf producers, including Iraq, Saudi Arabia, the UAE and Kuwait, were among its major suppliers, while Qatar was a leading source of liquefied natural gas (LNG).
India has a more diversified supply network than its South Asian neighbours, with crude also arriving from Russia, Africa and the Americas. Pakistan is also highly dependent on imported energy, particularly crude oil, petroleum products and LNG. Saudi Arabia, the UAE and Kuwait have traditionally been important oil suppliers, while Qatar is its main long-term LNG provider.
Bangladesh produces natural gas domestically, but increasingly relies on imported LNG as local production struggles to meet demand. Qatar is one of its main LNG suppliers, while the country also imports refined petroleum products. Nepal has no direct crude oil or LNG imports from the Gulf.
Instead, the landlocked country relies on India for virtually all of its petroleum products, including petrol, diesel, kerosene and LPG. Its exposure to Gulf disruptions is indirect: higher costs or supply shortages in India can feed through to Nepal’s fuel supplies and prices. India faces the largest exposure in absolute volumes, while Pakistan and Bangladesh have fewer alternatives for some critical energy supplies.
Nepal’s dependence is one step removed, but disruptions to India’s energy supply chain can quickly reach the Nepali market. As is often the case, it is the poor and economically vulnerable who are bearing the brunt of the crisis. Sajida Jibran is a 45-year-old housekeeper in Pakistan’s southern coastal city of Karachi.
Extract — continue reading at the source.
