The India-Middle East-Europe Economic Corridor (IMEC) — a US-backed rival to China’s Belt and Road Initiative — will include a hydrogen pipeline to facilitate exports to the EU, according to a memorandum of understanding (MoU) agreed on the sidelines of the G20 leaders’ summit in New Delhi last Saturday.

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The pact, signed by the governments of the US, the EU, India, Saudi Arabia, the UAE, France, Germany and Italy, calls for a ship-to-rail network in two separate trade corridors — one connecting India to the Arabian Gulf and the second connecting the Middle East to Europe.

“Along the railway route, participants intend to enable the laying of cable for electricity and digital connectivity, as well as [a] pipe for clean hydrogen export,” says a White House statement, suggesting the pipeline may be built in the overland sections of the corridor between the UAE, Saudi Arabia, Jordan and Israel.

“Participants intend that the corridor will increase efficiencies, reduce costs, enhance economic unity, generate jobs, and lower greenhouse gas emissions — resulting in a transformative integration of Asia, Europe and the Middle East,” the White House adds.

The MoU is non-binding, but the governments are due to meet within 60 days of the signing to set out a timetable for the development of this network.

IMEC could be seen as a US-led attempt to match China’s Belt and Road Initiative to build out new road, rail and port infrastructure in a bid to set up trade routes with the rest of Asia, Eastern Europe and Africa.

And this new initiative could also be viewed as the West’s response to the forecasted geopolitical realignment around Brazil, Russia, India, China and South Africa — the so-called “BRICS” alliance — as these economies start to increasingly trade with each other rather than depending on relations with the West.

At a summit in August, in addition to tabling a proposal by Brazilian president Lula da Silva for a single currency that would compete against the dollar, BRICS added Saudi Arabia and the UAE among other countries to its bloc.

But while BRICS presents something of an economic threat to the US and EU, some analysts have pointed out that the alliance does not necessarily constitute a formal political organisation yet, particularly given geopolitical tensions between India and China.

As such, IMEC — which could bolster India’s plans to export significant volumes of clean H2 to Europe — may be seen as a way to strengthen ties with one of the US’s allies within BRICS. And it could also help to keep Saudi Arabia and the UAE on-side despite the likelihood that the energy transition will necessitate less oil and gas flowing into the EU.

However, Israel and Jordan have not signed the MoU, and Saudi Arabia has no formal diplomatic relations with Israel — although relations between the two countries have thawed in recent years since peace accords were signed between Israel and the UAE.

European engineering consultancies RINA and AFRY published a report earlier this summer suggesting that the cost of transporting hydrogen through a Middle East-to-Europe pipeline could be €1.20 per kg of H2, allowing a delivered cost of €2.70/kg from the 2030s and €2.30/kg in the long term.

However, they had envisioned a route through Qatar, Saudi Arabia, and Egypt to Greece — which could present some level of geopolitical risk given a years-long trade embargo between the first two countries was only resolved at the end of 2021, with ongoing tensions over influence in the region.