Indian investment in Australia could be deterred if obstacles to the giant Adani Enterprises coal project in the Galilee basin are not overcome, the country's Minister of State for Power, Coal, New and Renewable Energy has warned.
Piyush Goyal, an influential figure in India's BJP government, also said "climate justice" demands rich nations do more in response to global warming and that it would be unfair to deprive India of low-cost energy from fossil fuels when per capita carbon emissions in developed countries are so high.
Mr Goyal, who is visiting Australia, said a "deep engagement" in the energy sector can become the defining feature of Australia-India economic ties but he cautioned delays to Adani's Carmichael mine could take a toll on investor confidence.
"Clearly further investment will not come in unless there is a quick resolution of this issue," he told BusinessDay. "People would worry to invest given the large amounts of capital that this company had promised to put into the economy."
Adani Enterprises plans to build Australia's largest coal project in Queensland's Galilee Basin but the project has been beset by controversy and hold-ups, including a successful legal challenge to a federal environmental approval. The recent collapse in coal prices has also cast doubt on the project's viability.
"What we are seeing is multiple road blocks," Mr Goyal said.
"It's almost like you are barely through one hurdle and something else crops up so it would be a deterrent to further investment,"
But Mr Goyal, who met with federal Resources Minister Josh Frydenberg earlier this week, said the project promised to be "win-win" for both countries.
"I get the impression that there is consensus amongst the political establishment, on both sides, that they would like to see early resolution of this problem," he said.
Mr Goyal said coal would continue to provide base-load power in India alongside ambitious plans to increase the use of renewable energy in response to climate change.
"I believe India has demonstrated to the world that we are a responsible global citizen," he said.
But he said India needed "some carbon space to develop its economy" using low-cost energy from fossil-fuels and that it would be "absolutely unfair" to expect low income families in India to be deprived of cheap energy.
"India never was the polluter of the atmosphere in the first place," he said.
Mr Goyal said high income countries have a responsibility to make large investments to find affordable alternatives to fossil fuels.
"Climate justice demands that those who have enjoyed the fruits of development over the years on the back of low cost fossil fuels will have to contribute to solving that problem in the days to come," he said.
But he said the "developed world is not seeming to do enough" in the search for low-cost energy alternatives.
"[They are] not even fulfilling their own commitments to put in capital to support large scale resolutions of atmospheric problems," he said.
Mr Goyal also flagged deregulation of India's resources industry that would allow Australian mining firms greater access to the sector. Although he did not give a timeframe for reform.
"At an appropriate time we will be opening up coal mining to international companies and I'm sure Australia will be part of it," he said.
