India: Petroleum policies and geopolitics

Abstract

India has, since the 1980s, been inordinately dependent on imported petroleum, since the quantity of indigenously extracted petroleum has been insufficient to cater to the growing demand for petroleum-derived fuels. The exponentially increasing import dependency not only ran contrary to India’s ultimate aim of energy independence but also represented a considerable drain on the national budget. Since the late 1990s the Indian government made a concerted effort in improving India’s indigenous petroleum production by opening up its upstream sector to privatisation. India’s state-owned oil and gas companies also acquired equity stakes in oil fields globally with the intent of supplementing direct oil import with import from ‘Indian-owned’ oil fields. India’s intention to increase its utilisation of natural gas—seen as a ‘clean’ energy source—led to the government’s efforts, since the late 1990s, to increase gas imports as well as increase indigenous production from conventional oil and gas fields and unconventional sources such as coal bed methane and shale gas.