India will see a huge investment of around US$ 100 billion, over the next five years, in developing the oil and gas infrastructure as the world’s third-largest energy consumer steps up spending to meet rising demand, petroleum minister Mr. Dharmendra Pradhan said.
He further added, while speaking at KPMG’s Enrich 2019 conference, that energy transition of the country will be in a responsible manner and the country will make its own course, though India is believed to be a major driver of global energy demand in the coming decades.
“India will see an investment of US$ 100 billion by 2024 in oil refining, pipelines, city gas distribution networks, and LNG terminals,” Mr. Pradhan said.
Out of the total investment, US$ 60 billion will be used into creation of gas infrastructure such as pipelines, city gas networks, and import terminals, he said.
He added that the foreign investment inflow into upstream oil and gas exploration and production as well as downstream fuel marketing and petrochemicals is required by the country.
India will obtain capital, world-class technology and implement any policy reforms required to become an international energy leader, he said. “India wants to be the new destination for global energy players.”
Several reforms such as opening of fuel retailing to non-oil companies and overhaul of exploration licensing policy are aimed at attracting investments, he said.
At present, India is the third-largest energy consumer in the world in absolute terms after the US and China. Though, per capita energy consumption in India is only about one-third of the world’s average.
“This makes it imperative to ensure energy justice to all, which essentially means access to energy in an affordable and sustainable manner,” he added.
India will be the key driver of the global energy demand in the coming decades as there is huge energy requirement and growth potential.
This energy demand cannot be met by a single source. “India will chart its own course of the energy transition in a responsible manner and would greatly influence global energy transition,” he said.
“In India, we are finding ways to achieve the twin objectives of more energy and less carbon through a healthy mix of all commercially-viable energy sources. India will chart its own course of the energy transition in a responsible manner.”
The priority of the government is meet the energy demand and growth in a sustainable manner. In order to meet the demand, the world as well as India are seeking out different methods to advance global growth and welfare.
He said the path to end energy poverty in India would be based on special national circumstances, as compared to the rest of the world. This is more so when the average Indian lives only on a third of the per capita consumption of energy that the United Nations believes is necessary for human well-being.
The government has undertaken many structural reforms in the last 5 years in order to create a business-friendly environment. These reforms include insolvency and bankruptcy code, tax reforms and intellectual property reforms. The hydrocarbon sector has seen changes through a series of business-friendly policy measures.
Government is now making all efforts to develop a gas-based economy. An estimated investment of US$ 60 billion is lined up in developing gas infrastructure, which includes pipelines, city gas distribution, and LNG terminals.
Mr. Pradhan also talked about the National Biofuel policy which aims on waste-to-wealth creation and targets to produce various types of biofuels from agriculture residue and municipal waste.
He added that the share of renewable in electricity capacity has considerably gone up now to 22 per cent from around 10 per cent in 2014-15.
Additionally, the ethanol blending percentage in petrol has risen from 0.67 per cent in 2012-13 to close to 6 per cent now.
“Finally, more than 95 per cent households now have access to LPG, making their kitchens smoke free,” he said.