India Energy Week: India has best rate of return in the world, says PM Modi

Transitional measures like green hydrogen, along with issues of technology (tech) transfer and financing, were among the major issues discussed at the energy round table held by Prime Minister (PM) Narendra Modi on the sidelines of India Energy Week 2023 on Monday, informed sources.

The round table was attended by chief executive officers of domestic and foreign oil and gas companies, global experts, and chiefs of multilateral institutions.

The annual round table was organised for the first time after the pandemic. All participants made presentations to the PM, who made the closing remarks.

The main focus was on the need for transitional measures, the capital and tech needed to harness them, and the ways to finance them, said sources.

“There is a delicate balancing act at work. The government needs to bring in more investments to harness the full potential of the exploration and refining sectors. But India also cannot be seen to be veering off the course of green, renewable-led growth,” said a senior industry source present at the meeting.

Transitional measures, such as green hydrogen, are in a sweet spot, he added.

Participants flagged the need for a stable policy architecture. Most said that the ease of doing business has improved in the past few years.

The PM emphasised the need for major investments in the energy sector. He asked companies to invest in both traditional hydrocarbons and new emerging technologies.

Arguing that India’s energy demand growth would be growing at 3x the rest of the world’s, he said investing in India would have a ‘best rate of return’ for companies.

Foreign partnerships in focus

The heads of Indian public sector oil-marketing companies (OMCs), who were at the meeting, said they were actively looking to pursue a foreign partnership.

A strategic sector like oil and gas has long had restrictions on foreign entrants in select sub-industries. However, the government had recently asked OMCs to utilise tech and market expertise.

“The move is part of the government’s plan to set up India as a key hub for hydrocarbons. While we have consistently been the second largest importer of crude oil in the world, we are now working to vastly expand our refining capabilities and industry-led services,” said a senior executive from an OMC.

One of the key areas where foreign companies, such as American oil and gas giants ExxonMobil, Chevron Corporation, and French giant TotalEnergies, have expressed keen interest in is exploration, added sources.

India is currently in the process of doubling the total area under exploration.