The Minister of Petroleum and Natural Gas & Steel Dharmendra Pradhan has called for inclusion of petroleum products under the GST (Goods & Services Tax) regime. Speaking at the third India Energy Forum by CERAWeek in New Delhi today, he appealed to the Union Finance Minister Nirmala Sitharaman to take this up in the GST Council and make a beginning by including natural gas and ATF in the GST.
The theme of third India Energy Forum by CERAWeek Conference is ‘New India’s Energy @75: Balancing Energy Security and Sustainability’, which sees over 1,200 delegates from 15 countries and 300 companies participating in the three-day conference.
“It’s been two years since the introduction of historic tax reform the GST was implemented by Prime Minister Modi. Given the complexity of petroleum sector and the revenue dependence of state governments in this sector, petroleum products have been kept outside the ambit of GST regime. There has been continuous demand from the petroleum industry for inclusion of petroleum products under GST regime,” said Pradhan.
He added that no single form of energy can meet the growing energy demand in India. Mixing all commercially viable energy sources is the only feasible way forward in India's context. India will chart its own course of energy transition in a responsible manner, said Pradhan.
$60 billion investment in pipeline
The Petroleum Minister highlighted some measures taken by the government to overhaul the hydrocarbon policy framework to revitalise oil and gas ecosystem and establish a conducive business environment. Pradhan said that growing presence of global oil and gas majors like Saudi Aramco, ADNOC, BP, Shell, Total, Rosneft and ExxonMobil in India is a testimony to the confidence of global investors on India’s growth story. “I am glad to see investors, Making in India, for India, and also for the globe.”
Pradhan said that India has successfully completed three bid rounds under Open Acreage Licensing Policy and two rounds of bidding under the Discovered Small Fields (DSF) policy. Through these successful biddings, India is expected to garner an estimated investment of $58 billion (Rs 411,916 crore) in E & P sector by 2023.
“I am happy to inform you that as we speak, an estimated investment of $60 billion (Rs 426,120 crore) is lined up in building gas pipelines, terminals, and city gas infrastructure that are in different stages of implementation,” added Pradhan. The City Gas Distribution network development in India has been authorised for building and commissioning will cover half of India’s geography and would serve 70 percent of India’s population through availability of low carbon and affordable natural gas.
He further said that the government's commitment to make India a low carbon economy, though the per capita carbon emission is far less than the world average particularly the OECD countries. Regarding the downstream sector, he said that it has been completely liberalised. Market-driven pricing of major petroleum products reflects the changes in line with the international price of crude oil. “Our fuel standards are comparable to the best in world and pan India BS-VI complaint fuel will be available in India from April 1, 2020,” said Pradhan.
Driving energy sustainability
To promote energy sustainability, the Petroleum Minister said that the country is giving a thrust on biofuels. The new National Biofuel policy envisages an integrated approach to produce biofuels from various types of agriculture residue and municipal solid waste. An important initiative has been undertaken to produce compressed biogas from biomass waste.
The government has targeted setting up of 5,000 compressed biogas plants in different parts of the country. These plants are being set up by private entrepreneurs. Oil marketing companies are offering assured price and offtake guarantee to procure the compressed biogas. Highlighting some difficulties being faced by these private entrepreneurs to access to bank finance for setting up CBG plants, he called upon the Finance Minister to look into this challenge. The minister said India also aims to achieve 10 percent blending percentage of ethanol in petrol by 2022 to cut dependence on energy import, promote the use of environment-friendly fuel and boost the agriculture sector. He said the government is accelerating conversion of Used Cooking Oil (UCO) to biodiesel across 100 cities in India.
Image courtesy: Dharmendra Pradhan/Twitter