The Hindu : `Investments in oil sector will aid GDP growth'

Online edition of India's National Newspaper
Friday, Jan 10, 2003

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`Investments in oil sector will aid GDP growth'

By Our Special Correspondent

NEW DELHI JAN. 9. The Tenth Plan envisages an investment of over Rs. 1,70,000 crores for development of oil and gas sector, which is expected to play a major role in increasing the country's annual GDP growth.

The investments, the Petroleum Minister, Ram Naik, said were indicative of the massive opportunities in the petroleum sector. He was delivering the inaugural address at the India Petrotech 2003 — an international petroleum conference and exhibition — here today.

At the same time, the Deputy Chairman of the Planning Commission, K.C. Pant, proposed restructuring and disinvestment of oil public sector units (PSUs) on a "selective basis" to achieve the eight per cent growth target set for the Tenth Five-Year Plan period.

Delivering the theme address at Petrotech 2003, he said the Tenth Plan laid down priorities for the oil and gas sector to further the development and consolidation of the oil and gas industry. Some of the important measures in this regard include restructuring and disinvestment of PSUs on a selective basis.

Mr. Pant's comments are significant in the light of the current controversy over disinvestment of PSUs in the oil sector which had erupted in September and is still going on as the Disinvestment Ministry awaits the opinion of the Attorney General on legal issues.

He also called for creation of an apex committee on energy to manage the trade-offs between the divergent objectives that could arise between the different sub-sectors. Setting out priorities for the sector, he laid emphasis on focussing on energy efficiency improvement, benchmarking the entire hydrocarbon sector to the international level, creating and enabling atmosphere for development of infrastructure facilities, promoting a greener and cleaner environment, establishment of a regulatory board and development of alternative fuels.

Earlier, Mr. Naik said that against a backdrop of the ever-widening supply-demand gap, which stood at 70 per cent, boosting the domestic oil and natural gas production, increasing refining and pipeline capacities and expanding the marketing infrastructure was urgently needed to meet the increasing energy demand to help sustain the momentum of the country's economic growth.

He said India's participation in oil equity abroad, especially ONGC Videsh Limited's $ 740 million Sudan deal, would boost the country's efforts to achieve energy security. In fact, he disclosed that in the first week of April, the Government would announce the fourth round of NELP and the second round of coal bed methane blocks.

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