India has experienced a surge in petroleum product exports over the past decade, with its refining capacity now exceeding 250 million metric tonnes per annum (MMTPA), enabling the country to meet global demand, according to a press release from the Ministry of Petroleum & Natural Gas.
India ranks among the top five refining nations globally and is the seventh-largest exporter of refined petroleum products, the statement added.
Historical Growth and Industry Expansion
India’s petroleum industry traces its roots back to 1867, with the first oil well drilled in Digboi, Assam. Over the decades, the sector has transformed from small-scale refineries into a massive network meeting both domestic and international demands. Public sector giants like ONGC and Indian Oil Corporation have spearheaded the industry’s expansion, alongside private investments that have boosted refining and export capacities.
India’s Global Standing in Petroleum Industry
India ranks among the top refining and fuel-exporting nations, playing a crucial role in the global energy market. The International Energy Agency (IEA) projected in February 2024 that India will become the largest source of global oil demand growth by 2030.
India is also the second-largest economy in biofuel blending, following Brazil. It ranks second in ethanol blending with petrol, third in biofuel production, and fourth in LNG terminal capacity worldwide.
Major Developments in India’s Petroleum Sector
Expansion in Exploration Acreage: India aims to increase its exploration acreage to 1 million sq. km by 2030, with a 16% increase expected in 2025.
Affordable Domestic LPG: The price of a 14.2 kg LPG cylinder is as low as Rs.803, among the cheapest globally. PMUY households receive a Rs.300 subsidy, making the effective price ₹503 per cylinder.
Simplified Approval Process: The number of approvals required for petroleum exploration has been reduced from 37 to 18, with nine approvals now available through self-certification.
Policy Reforms for Stability: The Oilfields (Regulation and Development) Amendment Bill, 2024, passed by the Rajya Sabha on December 3, 2024, ensures a single license for all hydrocarbons, enhancing investment security.
Foreign Trade and GDP Contribution
India’s petroleum industry has significantly contributed to economic growth, with petroleum product exports surging over the past decade. The refining sector’s expansion has strengthened India’s trade partnerships with South Asian, African, and European nations.
According to the Ministry of Statistics and Programme Implementation, the Gross Value Addition (GVA) of Coke and Refined Petroleum Products has grown from Rs.1.56 lakh crore in 2012-13 to ₹2.12 lakh crore in 2022-23, supporting GDP growth from Rs.99.44 lakh crore to Rs.269.49 lakh crore in the same period.
Technology and Sustainability in Petroleum Industry
India is embracing Enhanced Oil Recovery (EOR) techniques, AI-driven digitalization, and green technologies to optimize refining and reduce environmental impact. The country is investing in bio-refineries and alternative fuels like compressed bio-gas (CBG) to transition towards cleaner energy solutions.
Government Initiatives Strengthening the Sector
Key government programs are accelerating the petroleum industry’s progress:
Pradhan Mantri JI-VAN Yojana: Supports bio-ethanol projects for sustainable fuel production.
Strategic Petroleum Reserves (SPR): India has 5.33 MMT of crude oil reserves in underground storage facilities to ensure energy security.
Ethanol Blending Program (EBP): India targets 20% ethanol blending in petrol by 2025-26, reducing fossil fuel dependency.
Future Outlook
With rising global demand and domestic capacity expansion, India is poised to become a key energy supplier in the coming decade. The government’s focus on policy reforms, technological advancements, and clean energy solutions will ensure the petroleum sector continues to drive economic growth and global trade.
