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Cross-border energy trade between India and South Asian Countries: Current dynamics and future scenarios

Author

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  • Jha, Amit Prakash
  • Mahajan, Aarushi
  • Sheetal,
  • Singh, Sanjay Kumar

Abstract

This study investigates Cross-Border Electricity Trade (CBET) in South Asia, centering on India and its neighbours—Bangladesh, Bhutan, Nepal, and Sri Lanka—to harness opportunities for regional cooperation, energy security, and renewable energy (RE) integration. A comprehensive literature review identifies core research themes, underscoring CBET's advantages in bolstering energy security and sustainability, while confronting challenges such as market asymmetries, policy inconsistencies, and RE intermittency. Leveraging Nepal and Bhutan's hydropower abundance alongside India's solar and wind expansion, yet constrained by technical hurdles, the analysis employs theories of comparative advantage, trade diversion, and reciprocal load smoothing to advocate for synchronized policies and infrastructure enhancements. Utilizing LEAP modelling in a pioneering CBET context, results indicate that intensified CBET optimizes RE deployment, curbing 100-year global warming potential (GWP) by over 30 % relative to the Baseline Scenario, fulfilling escalating demand, and mitigating intermittency via interconnected grids. These outcomes resonate with SDGs 7 and 13, positioning India as a pivotal hub and furnishing policymakers with strategic guidance for sustainable regional energy frameworks.

Suggested Citation

  • Jha, Amit Prakash & Mahajan, Aarushi & Sheetal, & Singh, Sanjay Kumar, 2025. "Cross-border energy trade between India and South Asian Countries: Current dynamics and future scenarios," Energy, Elsevier, vol. 340(C).
    • Handle: RePEc:eee:energy:v:340:y:2025:i:c:s0360544225048819
    DOI: 10.1016/j.energy.2025.139239
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