Key challenges for Indian oil & gas sector in Budget

As Budget 2023-24 is ready to be presented before parliament by the FM Nirmala Sitharaman the oil & gas (O&G) sector in India has the following vital challenges.

• Policy stability on transport fuel pricing
• GST on petroleum products and gas: Exclusion leading to depriving of benefits of classical GST regime and increasing administrative burden
• Ability of E&P concessions to attract large and experienced investors
• Emergence of renewable fuels causing displacement of petroleum fuels’ demand
• Investment to supply PNG and LPG to domestic consumers may go obsolete in the near-term due to the proposal to electrify homes

What O&G industry expects from this Budget

• Support SMEs to develop infrastructure for molecules like hydrogen, ethanol, biodiesel, biomass, and biogas
• Consumers demand aggregators tying up with cheaper LNG/gas sources
• Oil companies and fossil fuel-dependent industries seek clarity on emerging carbon credit policies to plan their future investments
• Development of large petrochemicals and chemicals zones for investors to avoid hunting for land, utilities, and supply chains.