India is particularly vulnerable as an increase in global prices can affect its import bill, stoke inflation and widen trade deficit
NEW DELHI: Union cabinet minister Hardeep Singh Puri on Thursday took charge of India’s petroleum and natural gas ministry. Puri, a 1974-batch Indian Foreign Service (IFS) officer, has been put in charge of nation’s energy security as the country undergoes an energy transition, with several new age fuels in play.
Puri, a student of History from Hindu College, is no stranger to international diplomacy and has had a successful carrier in the foreign service, where he served as India’s permanent representative to the United Nations and also served as secretary, economic relations, in the ministry of external affairs (MEA).
“The work of this ministry touches each and every citizen in the country directly or indirectly. The energy issues in this ministry have immense potential and several challenges. The need to adapt to changing times, adopt new technologies and to be in consonance with the energy transition taking place across the world, provides a fascinating opportunity," Puri, also the union cabinet minister in charge of housing and urban affairs, said after taking charge of the oil ministry.
A Rajya Sabha MP from Uttar Pradesh, Puri’s international experience is expected to serve India well in the uncertain world of energy diplomacy. A recent case in point being the Organisation of the Petroleum Exporting Countries (Opec) plus grouping unable to reach an agreement on oil production with differences between Saudi Arabia and United Arab Emirates.
This assumes importance given that diesel and petrol prices have breached the ₹100 mark in several parts of India. With the Opec grouping accounting for a major part of India’s crude oil imports and around 40% of global production, India, the world’s third largest oil importer, has been flagging its concerns over rising global crude oil prices and requesting phasing out of production cuts to Opec.
Diversifying India’s energy basket with crude oil supplies from non-Opec sources is part of its energy security efforts. This is where oil diplomacy is expected to bear fruits as India is leaning on its old energy partner Russia to buffer its consumers and increasing its oil imports from the US. India is also tapping new sources such as Guyana.
India is particularly vulnerable as any increase in global prices can affect its import bill, stoke inflation and widen trade deficit. Following the covid outbreak, crude prices for Indian basket of crude had plunged to $19.90 in April last year during the first wave before recovering to 71.98 a barrel in June, data from the Petroleum Planning and Analysis Cell showed.
Puri also takes charge of the critical ministry at a time when India’s domestic crude and oil and gas production is faltering.
“As we transform towards a five trillion economy, energy availability and consumption will be of paramount importance. My focus will be on increasing domestic production of crude and natural gas, in line with the Prime Minister’s vision of Aatamnirbhar Bharat," Puri added.
Puri was earlier minister of state (MoS) with independent charge in the ministries of housing and urban affairs and civil aviation. He was also MoS in the commerce and industry ministry and is among the few Indians who presided over the United Nations Security Council. During his stint at UN, he also chaired its Counter Terrorism Committee—the first Indian to do so.
Puri’s global experience is expected to help Indian oil and gas firms, who have invested around $38 billion for acquiring equity energy stakes in 28 countries, including Australia, Azerbaijan, Bangladesh, Brazil, Canada, Colombia, East Timor, Gabon, Indonesia, Iran, Iraq, Israel, Libya, Mozambique, Myanmar, Namibia, New Zealand, Nigeria, Oman, Russia, South Sudan, Sudan, Syria, USA, UAE, Venezuela, Vietnam and Yemen.
“I will also work towards development of a natural gas-based economy in the country and increase the share of natural gas in primary energy mix of the country to 15% by 2030 as announced by Hon’ble PM," Puri said.
Gas comprises about 6.2% of India’s primary energy mix, far behind the global average of 24%. The government plans to increase this share to 15% by 2030. India’s gas demand is expected to be driven by the fertilizer, power, city gas distribution, and steel sectors.
Also, Rameswar Teli took charge as the minister of state in the ministry on Thursday after the cabinet reshuffle and expansion on Wednesday.
India is also working on an ambitious green hydrogen plan, wherein the government plans to make use of new age fuel mandatory in fertilizer plants and oil refineries to meet some part of their requirement.
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