Advantage India
Growing
Demand
* Oil demand in India is projected to register a 2x growth to reach 11 million barrels per day by 2045.
* Diesel demand in India is expected to double to 163 MT by 2029-30, with diesel and gasoline covering 58% of India’s oil demand by 2045.
* Consumption of natural gas in India is expected to grow by 25 billion cubic metres (BCM), registering an average annual growth of 9% until 2024.
* Crude oil imports increased by 5.7% and 0.9% during January 2024 and April-January 2023-24 respectively as compared to the corresponding period of the previous year.
Rapid
Expansion
* India aims to commercialize 50% of its SPR (Strategic Petroleum Reserves) to raise funds and build additional storage tanks to offset high oil prices.
* Indian refiners would add 56 million tonnes per annum (MTPA) by 2028 to increase domestic capacity to 310 MTPA.
* Indian refining capacity has increased from 215.1 Million Metric Tonne Per Annum (MMTPA) to 256.8 MMTPA in last 10 years.
* The industry is expected to attract Rs. 218,475 crore (US$ 25 billion) investment in exploration and production. Refining capacity in the country is expected to increase to 667 MTPA by 2040.
Supportive FDI
Guidelines
* In July 2021, the Department for Promotion of Industry and Internal Trade (DPIIT) approved an order allowing 100% Foreign Direct Investments (FDIs) under automatic route for oil and gas PSUs.
* The Government has allowed 100% Foreign Direct Investment (FDI) in upstream and private sector refining projects.
Policy
Support
* The Union Budget 2025-26 has allocated Rs. 5,597 crore (US$ 640.46 million) to the petroleum and natural gas (PNG) ministry for phase II of the Indian Strategic Petroleum Reserves Ltd (ISPRL) project, aimed at turning two vast underground caverns into petroleum storage facilities
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