S C Jamir, Governor of Maharashtra and Goa in India, made a startling remark while speaking at the inauguration of the SFG International Conference on Responsibility to the Future. He suggested that just as coal and steel had created lasting cooperation between France and Germany in the last century, energy and environmental industries would be the building blocks of peace between hostile nations in the 21st century.

On the surface, Governor Jamir�€™s comment may appear wishful thinking. The history of the 20th century, and indeed the first decade of this century, was characterised by conflicts driven by oil. The British and the French rulers divided the Middle East at Paris in 1919 between themselves mainly out of lust for oil. The two Gulf wars, West-Islam conflict, attacks on the Twin Towers, and continued violence in the Middle East are directly or indirectly attributed to the politics of oil. Experts have written books about how the 21st century will be dominated by resource conflicts. However, what we see at surface often hides the depth of the truth beneath.

The world is preparing for a new economy beyond fossil fuels. In Europe, two bold experiments are under way. One aims to produce energy through nuclear fusion. The other aims to replicate the creation of universe through collision of the particles of gold and lead at super-speed, and in the process discover a new source of infinite energy. There are a large number of experiments being made to tap energy from the sun, wind and oceans. The Philippines is emerging as a major producer of geothermal energy. 

Most of these experiments are collaborative. The experimental reactor for nuclear fusion in Europe is a cooperative project of 7 countries including the United States, China and India. The particle collision accelerator project also brings together scientists and investments from several countries. Search for solar, wind and ocean energy involves joint ventures between private sector companies from different parts of the world. Search for new sources of energy is thus bringing nations, including rivals, together in a constructive way. Countries such as India, Korea, the Philippines, Mexico, South Africa and others have been bestowed with solar, wind, geothermal and ocean resources. But they need technology and investments from the North American and European companies and institutions to harness them. It is only through mutual cooperation that the transition to the next sources of energy can take place.

The scenario is somewhat different when we consider the development of clean and green technologies. Almost 90% of investments in clean technologies are concentrated in North America and Western Europe with a gradually growing share of North-East Asia. Entrepreneurs in these economies are developing energy-efficient lights, paints, construction material, town designs, and transit systems. They are investing in nano-technology that can also create alternative materials that require less of fossil fuel inputs. They may sell products and services resulting from such technologies at a high price to emerging economies, following the pattern of the last three industrial revolutions.

However, such a pattern would not be viable. If the emerging and developing economies cannot afford to pay for products developed in the developed countries, they will continue to live in the old economies that cause pollution and global warming. The West may react with environmental trade barriers but such a strategy will only make the developing countries more dependent on old practices. The only way to break the logjam would be to find means of collaboration between the developed and developing economies in technological and product development �€“ taking advantage of the competitive prices of human resources in the developing world. Also, in an era of open source research, a new pragmatic approach to patents and intellectual property rights will need to be developed. Thus, unless we prepare for a considered collaborative future from now, collaboration in environmental technologies will in any case be thrust upon the world in years to come �€“ albeit after an initial period of old fashion trade and technology transfer.

Movement from oil to nuclear and renewable sources of energy and clean technologies is not going to make oil disappear from the world economy. Oil and gas will very much form components of the new energy mix but they will not be the dominant components. Therefore, they will lose their strategic value. The West need no longer control the Middle East for oil. It may still want it for geopolitical reasons and the religious zealots may want it to see Armageddon come true. However, without oil, the incentive to spend billions on wars will be less. And with shrinking oil revenue, the Arab states in 20 years from now will have less money to import weapons �€“ except those that have successfully diversified out of oil economy. However, such states will have a vested interest in a collaborative global economy. We may find it difficult to imagine a post-fossil fuel world in 20-30 years from now. But 20-30 years is a long time. Who had guessed Internet and SMS economy in 1980?