India and Saudi Arabia signed a historic comprehensive cooperation pact in the energy industry on Tuesday

The MoU is anticipated to lead to strengthened ties between India and Saudi Arabia in the areas of energy security, natural gas, electricity and grid interconnections, hydrogen, renewable energy, power effectiveness, petroleum, and other fossil fuels.

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It also intends to encourage bilateral investment in the fields of oil and gas, renewable energy, electricity, hydrogen, and storage, as well as to encourage the advancement of carbon capture, utilisation, and storage technologies and a circular economy.

To start work on the prestigious India-West Asia-Europe Economic Corridor, we have teamed together. According to Prime Minister Modi, who opened the meeting, this corridor will strengthen economic cooperation, the energy sector, and digital connectivity between Asia, West Asia, and Europe in addition to unifying the two countries.

In a joint statement issued late Monday night, the two countries emphasised the significance of energy cooperation as a key pillar of their strategic partnership and emphasised the necessity of promoting communication and cooperation between oil-producing and consuming nations in addition to ensuring the security of energy supply sources on international markets in order to support the stability of the world's oil markets.

Saudi Arabia as the world's second-largest producer of crude oil

India has become the third-largest main energy user in the world and the world's fastest-growing major economy, while Saudi Arabia is the world's second-largest producer of crude oil.

In accordance with the National Green Hydrogen Mission, which was announced in August 2021 as part of the drive to diversify the country's energy supply, India has set a target of producing 5 million tonnes (MT) of green hydrogen yearly and an extra 125 GW of renewable energy capacity by 2030.

Additionally, the nation declared the creation of the Global Biofuels Alliance to promote the recycling of municipal solid waste (MSW), cow dung, and other agricultural and forestry waste for use in the production of biofuels like ethanol and ammonia.

Emphasis on Investments in different areas

The largest and most populous nation on the Arabian Peninsula, Saudi Arabia, has been working to shift its economy away from overdependence on oil by putting an emphasis on investments in blockchain technology, gaming, attracting foreign capital, and tourism as part of its Vision 2030 plan.

Therefore, the two nations will also be focusing on advancing innovation, cybersecurity, and AI in the energy sector.

Additionally, efforts will be made to create high-quality collaborations between the two nations in order to localise materials, goods, and services associated with all energy-related industries, supply chains, and technologies. In this sense, collaboration with businesses that specialise in the energy sector would be bolstered.