The parliamentary standing committee on petroleum and natural gas has noted that the government’s strategy to lower dependence on imported crude oil is far from adequate. In its 18th report, the parliamentary committee has said, “The five pronged strategy devised by the Ministry (of Petroleum and Natural Gas) is grossly inadequate and lacks inclusion of all round focus for the strategy, does not indicate R&D activities to be undertaken, financial incentives needed etc.” The committee has also noted that there needs to be better coordination among the various ministries and recommended that the entire exercise should be monitored at an Inter-Ministerial level.

The Committee was commenting on the Demand for Grants for the Financial Year 2017-2018 of the Ministry of Petroleum and Natural Gas. In respect to the reduction in Basic Customs Duty on Liquefied Natural Gas, the standing committee has noted that the proposed reduction from 5 per cent to 2.5 per cent will make the fuel competitive to alternative fuels. However, it has noted that the government needs to take more policy measures and make gas an attractive choice for industries.

With regards to meeting the Ethanol blending targets of 5 per cent blending in 2017-2018 and 10 per cent blending by 2020, the committee has recommended allowing imports of ethanol.

The committee has also noted that there was substantial variation in allocations for ‘refinery and marketing’ sector and ‘petrochemicals’ sector. The report highlights that for financial year 2016-2017, Budgetary Estimate of Internal and Extra-Budgetary External Resources (IEBR) expenditure was Rs 87.214.56 crore and the revised Estimate was Rs 1,04,673.56 crore. The BE for fiscal 2017-2018 has been reduced to Rs 86,027.29 crore. It noted, “The Committee is unhappy at such great variation in figures for BE, RE and the Actual in the last two years as it shows poor planning on the part of PSUs.”