OIL & GAS: Why set­tle for ‘Sell in In­dia’, when you can ‘Make in In­dia!’

Gfiles - - GOVERNANCE - ey K SUBRAMANIAN

For ev­ery bar­rel of oil pro­duced in In­dia, the gov­ern­ment earns more than 50 per cent of rev­enue through roy­alty, cess, profit pe­tro­leum; not to men­tion cor­po­rate in­come tax and other state level taxes. On the other hand, for ev­ery bar­rel of oil im­ported into the coun­try, the gov­ern­ment not only gets zero rev­enue but has to shell out pre­cious for­eign ex­change that has a di­rect bear­ing on the coun­try’s econ­omy. The need of the hour is to boost do­mes­tic pro­duc­tion through a ro­bust pol­icy and con­certed ef­forts.

Po­ten­tial aplenty

In­dia is a coun­try with ex­pan­sive oil and gas re­sources, and a huge po­ten­tial for new ex­plo­rations. In­dia’s 26 sed­i­men­tary basins have a to­tal re­source (in place) base of 41,872 mil­lion met­ric tonnes with vary­ing de­grees of prospec­tive hy­dro­car­bon po­ten­tial spread across on­shore, off­shore and deep­wa­ter ar­eas. Given In­dia’s cur­rent do­mes­tic crude pro­duc­tion of 36mil­lion tonnes, this it­self trans­lates into rev­enue of bil­lions of dol­lars for the gov­ern­ment, not to men­tion the en­ergy se­cu­rity it en­sures for the coun­try. The irony is that the cur­rent do­mes­tic oil pro­duc­tion barely meets less than 20 per cent of the coun­try’s needs with most of the de­mand be­ing met through im­ports. Prime Min­is­ter Naren­dra Modi’s vi­sion to cut im­ports by 10 per cent by 2022 through in­creased do­mes­tic pro­duc­tion will give a dou­ble boost to the econ­omy by way of in­creased rev­enue­share on do­mes­tic pro­duc­tion and sav­ings on for­eign ex­change for im­ports.

Swift re­sponse

Over the last more than four years, GOI has taken series of pol­icy lib­er­al­i­sa­tion mea­sures in the oil and gas sec­tor. GOI’s fo­cus is to at­tract in­vest­ments, usher ease of do­ing busi­ness and pro­mote the prin­ci­ple of ‘Max­i­mum Gover­nance and Min­i­mum Gov­ern­ment’. Dis­cov­ered small fields, pol­icy frame­work for early mon­eti­sa­tion of CBM, Hy­dro­car­bon Ex­plo­ration and Li­cens­ing Pol­icy (HELP), Open Acreage Li­cens­ing (OAL), pol­icy to ac­cess

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