THE JOURNAL OF ENERGY

AND DEVELOPMENT

Muhammad Azhar,
“India’s Emergence as a

Petroleum Products Exporter,”

Volume 47, Number 1

Copyright 2022
 INDIA’S EMERGENCE AS A PETROLEUM
PRODUCTS EXPORTER

Muhammad Azhar*

Introduction

I ndia’s continuous economic reforms and liberalization, which have been imple-
mented throughout the past three decades, have propelled the nation to become
the third largest economy in the world. Next only to China and the United States,
India was ranked as the third largest economy in 2016 based upon gross domestic
product (GDP) measured in purchasing power parity terms.1 Further, the Indian
economy has been able to continuously sustain one of the highest growth rates at a
global level. It has even surpassed China as one of the fastest growing economies
in the world. According to the World Bank, the annual GDP growth of the Indian
economy for 2016 was 7.1 percent compared to China’s rate, which stood at 6.7
percent for the same period.2 However, this continuous and sustained growth in
the Indian economy has necessitated increasing levels of energy consumption.

*Muhammad Azhar is a Professor of Economics at the Department of West Asian and North African
Studies, Aligarh Muslim University, Aligarh, India. His previous positions have been as a Reader at the
Academy of Third World Studies, Jamia Millia Islamia Central University (New Delhi), Research
Associate at the Gulf Studies Programme, Centre of West Asian and African Studies, School of
International Studies, Jawahar Lal Nehru University (New Delhi), and as a Consultant at the Indian
Council of Research in International Economic Relations (New Delhi). The author obtained his M.A. in
economics, M.Phil., and Ph.D. from Jawahar Lal Nehru University (New Delhi). Dr. Azhar has
authored Contemporary Gulf Economies and Indo-Gulf Relations (New Delhi: New Horizon
Publishers, 1999). He has contributed research articles to numerous international journals including
Arab Studies Quarterly, Middle Eastern Studies, Journal of Economics and International Relations,
OPEC Bulletin, OPEC Review, OPEC Energy Review, Journal of South Asian and Middle Eastern
Studies, BIIS Journal, and International Studies, as a sampling.

The Journal of Energy and Development, Vol. 47, Nos. 1-2

Copyright # 2022 by the International Research Center for Energy and Economic Development
(ICEED). All rights reserved.
75
76 THE JOURNAL OF ENERGY AND DEVELOPMENT

India has become the third largest consumer of energy measured in million tons of
oil equivalent. In terms of energy consumption, India is behind only China and the
United States as a top energy consumer and ahead of Russia and Japan.3 This has
made India one of the top importers of crude oil in the world. India stands as the
third largest net importer of crude oil.4 According to the Indian Ministry of Petro-
leum and Natural Gas Resources, India’s crude oil reserves stood at 604.1 million
metric tons as of March 31, 2017, whereas India’s crude oil production during the
period of 2016–2017 was reported at 36.01 million metric tons. Thus, India’s oil
production is relatively small in comparison to the economy’s requirements. There-
fore, India had to import 213.93 million metric tons of crude oil during 2016–2017
from various oil-exporting countries. This implies that 85 percent of India’s crude
oil requirements were fulfilled by imports during 2016–2017.5 Further, India also
imported 35.4 million metric tons of petroleum products and 18.63 million metric
tons of liquefied natural gas (LNG) in 2016–2017.
However, a distinct feature of the Indian petroleum industry has been the nation’s
emergence as a net exporter of petroleum products since the beginning of the 21st cen-
tury.6 India’s petroleum products exports in quantitative terms reached its maximum
at 67.86 million metric tons in 2013–2014. It declined to 60.4 million metric tons in
2015–2016 but rose to 65.51 million metric tons in 2016–2017.7 The effects of com-
petition can explain this variation in India’s petroleum products exports. It is further
reported that India was the fifth largest exporter of petroleum products during 2016,
ranking only behind the United States, Russia, Netherlands, and Singapore and ahead
of South Korea, Saudi Arabia, Belgium, and China. India’s exports of petroleum
products during 2016 constituted 5.3 percent of the world’s total exports of petroleum
products measured in U.S dollar terms.8 Thus, it can be concluded that India has
established itself as an important exporter of petroleum products worldwide. The next
section discusses the trends in India’s imports and exports of petroleum products.

Trends in Petroleum Products Import and Exports by India

Although the first oil refinery was set up in India in 1901 by Assam Oil Com-
pany Ltd., and after independence many refineries were established to enhance the
production of oil products for the domestic market. However, India remained a
substantial importer of petroleum products with demand outpacing supply for deca-
des. The reforms in the Indian economy, commonly called the Liberalization, Pri-
vatization and Globalization (LPG), were initiated in 1991. This was extended to
cover the petroleum sector as well. A committee under the then-petroleum secre-
tary was set up to recommend reform measures for the sector. The committee’s
recommendations were approved by the Indian government in 1998.9 Since then
there has been rapid expansion in India’s refining capacity to the extent that by
2001–2002 India became a net exporter of petroleum products.10 Subsequently,
 INDIA: A PETROLEUM PRODUCTS EXPORTER 77

there has been a comparative decline in India’s imports of petroleum products. The
information about India’s imports of petroleum products is provided in table 1.
During 1998–1999, India’s imports of petroleum products was reported at $2,895
million, which declined to $1,511 million in 2001–2002. After this it continuously
increased to $15,126 million by 2007–2008; then it declined and was reported at
$10,614 million in 2016–2017. The fluctuations in India’s imports of petroleum
products are mainly attributed to the fluctuations in global oil prices and the quan-
tity of imports. From 1998–1999 to 2016–2017, India’s imports of products
increased from $2,895 million to $10,614 million, thus growing by about 367 per-
cent. Meanwhile India’s total imports increased from $42,388.21 million in

Table 1
INDIA’S IMPORTS OF PETROLEUM PRODUCTS, 1998–2017a
India’s Imports of
Petroleum Products India’s Total Share in Total
Year ($ Millions) Imports ($ Millions) Imports (%)
1998–1999 2,895.00 42,388.71 6.8
1999–2000 3,264.00 49,738.06 6.6
2000–2001 2,642.00 50,536.45 5.2
2001–2002 1,511.00 51,413.28 2.9
2002–2003 1,822.00 61,412.14 3.0
2003–2004 2,114.00 78,149.11 2.7
2004–2005 3,278.00 111,517.43 2.9
2005–2006 6,302.00 149,165.73 4.2
2006–2007 9,068.00 185,735.24 4.9
2007–2008 15,126.00 251,654.01 6.0
2008–2009 13,557.00 303,696.31 4.5
2009–2010 7,088.00 288,372.88 2.4
2010–2011 12,068.00 369,769.13 3.2
2011–2012 14,189.00 489,319.49 2.9
2012–2013 12,590.00 490,736.65 2.6
2013–2014 12,466.00 450,199.79 2.7
2014–2015 12,138.00 448,033.41 2.7
2015–2016 9,952.00 381,006.63 2.6
2016–2017 10,614.00 384,355.56 2.7

Sources: Petroleum Planning and Analysis Cell, Ministry of Petroleum and Natural Gas,
Government of India (ppac.org.in) and Export Import Data Bank, Ministry of Commerce, Government
of India (commerce.nic.in).
a
Petroleum products as defined by harmonized system code HS-2710.
78 THE JOURNAL OF ENERGY AND DEVELOPMENT

1998–1999 to $384,355.56 million in 2016–2017, thus growing by more than 800

percent. This is also reflected in the share of India’s imports of petroleum products
in the nation’s total imports. This share declined from 6.8 percent in 1998–1999 to
2.7 percent in 2016–2017 (see figure 1).
Table 2 provides data on India’s export of petroleum products from 1998–1999
to 2016–2017. During 1998–1999 India’s exports of petroleum products were
reported at $86.0 million. Subsequently, exports increased continuously and signifi-
cantly to $60,664 million by 2013–2014. However, by 2016–2017 exports had
declined to $29,049 million. Between 1998–1999 and 2016–2017 India’s exports
of petroleum products grew by a factor of 338, whereas during the same period
India’s total exports increased by a factor of 8.3. This is reflected in the share of
India’s exports of petroleum products relative to India’s total exports (table 2 and
figure 2). The share of India’s exports of petroleum products in India’s total
exports was estimated at 0.3 percent in 1998–1999. This increased to 19.6 percent
in 2012–2013. By 2016–2017 it remained at 10.5 percent. The variation in the
share of India’s exports of petroleum products in the country’s total exports is
attributed to variations in the global oil prices as well as the quantity of India’s
exports of petroleum products. Table 2 also gives information about the rank of
petroleum products among India’s exportable commodities in the HS-4 digit com-
modity classification. Petroleum products became the second largest exportable
commodity from India in 2000–2001 and it remained so to 2005–2006. During
2006–2007 it became the top exportable commodity from India and by

Figure 1
SHARE OF INDIA’S PETROLEUM PRODUCTS IMPORTS OF THE COUNTRY’S TOTAL
IMPORTS (AS A PERCENTAGE), 1998–2017

8
7
6
5
4
3
2
1
0

Share of Total Imports (%)

 INDIA: A PETROLEUM PRODUCTS EXPORTER 79

Table 2
INDIA’S EXPORTS OF PETROLEUM PRODUCTS, 1998–2017a
India’s Exports
of Petroleum India’s Total
Products Exports Share in Total
Year ($ Millions) ($ Millions) Exports (%) Rank
1998–1999 86.00 33,218.72 0.3 –
1999–2000 161.00 36,822.49 0.4 –
2000–2001 1,676.00 44,560.29 3.8 II
2001–2002 1,731.00 43,826.72 3.9 II
2002–2003 2,251.00 52,719.43 4.3 II
2003–2004 3,661.00 63,842.55 5.7 II
2004–2005 6,660.00 83,535.94 8.0 II
2005–2006 11,233.00 103,090.53 10.9 II
2006–2007 17,907.00 126,414.05 14.2 I
2007–2008 27,956.00 163,132.18 17.1 I
2008–2009 27,282.00 185,295.36 14.7 I
2009–2010 30,662.00 178,751.43 17.2 I
2010–2011 43,340.00 249,815.55 17.3 I
2011–2012 59,319.00 305,963.92 19.4 I
2012–2013 58,848.00 300,400.58 19.6 I
2013–2014 60,664.00 314,405.30 19.3 I
2014–2015 47,277.00 310,338.48 15.2 I
2015–2016 27,059.00 262,290.13 10.3 I
2016–2017 29,049.00 275,851.71 10.5 I

Sources: Petroleum Planning and Analysis Cell, Ministry of Petroleum and Natural Gas,
Government of India (ppac.org.in) and Export Import Data Bank, Ministry of Commerce, Government
of India (commerce.nic.in).
a
Petroleum products as defined by harmonized system code HS-2710.

2016–2017, it still remained so. This reflects the importance that petroleum prod-
ucts have acquired in India’s export profile.
India’s exports of petroleum products include motor spirit (also known as gaso-
line or petrol), naphtha, aviation turbine fuel, high speed diesel, and fuel oil. The
information about India’s exports of motor spirit is provided in table 3 with figure
3 highlighting motor spirit exports as a percentage of the country’s total petroleum
products exports. Motor spirit is a transparent liquid derived from crude oil and is
mainly used as a fuel in internal combustion engines. From table 2, we can see that
India’s exports of motor spirit began in 1999–2000, when $32.0 million worth of
80 THE JOURNAL OF ENERGY AND DEVELOPMENT

Figure 2
SHARE OF INDIA’S EXPORTS OF PETROLEUM PRODUCTS TO COUNTRY’S TOTAL
EXPORTS (AS A PERCENTAGE), 1998–2017

25

20

15

10

Share in Total Exports (%)

motor spirit was exported constituting 20 percent of India’s petroleum product

exports in that year. India’s exports of motor spirit continued to grow steadily and
peaked at $17,528 million in 2012–2013, constituting 29.8 percent of India’s petro-
leum products exports in that time. The growth in India’s exports of motor spirit is
attributed to the rise in global oil prices as well as expansion in market share. How-
ever, since then, India’s motor spirit exports have declined continuously to a value
of $7,895 million in 2016–2017 and constituting 27.2 percent of India’s petroleum
products exports. The decline in the value of India’s motor spirit exports is
explained more by declining global oil prices and less by the contraction of market
share.
The data on India’s exports of naphtha has been provided in table 4 with figure
4 illustrating the share of naphtha as a percentage of India’s total petroleum prod-
ucts exports. Naphtha is an extremely flammable liquid derived from refining crude
oil. Naphtha is used to dilute heavy oil to help move it through pipelines, to make
high octane gas, to make lighter fluid, and also to clean metal. From the informa-
tion in table 4, we find that India exported naphtha for the first time in 1998–1999,
worth $86 million and constituting 100 percent of India’s petroleum products
exports. India’s exports of naphtha peaked in 2011–2012, valued at $9,482 million
and constituting 16 percent of India’s exports of petroleum products in that year.
Since then, India’s exports of naphtha declined and were valued at $3,666 million
 INDIA: A PETROLEUM PRODUCTS EXPORTER 81

Table 3
INDIA’S EXPORTS OF MOTOR SPIRIT, 1999–2017
Share of Motor
India’s Exports of India’s Export of Spirit in India’s
Motor Spirit Petroleum Products Petroleum Products
Year ($ Millions) ($ Millions) Exports (%)
1999–2000 32.0 161.0 20.0
2000–2001 315.0 1,676.0 19.0
2001–2002 538.0 1,731.0 31.0
2002–2003 623.0 2,251.0 27.7
2003–2004 876.0 3,661.0 24.0
2004–2005 1,251.0 6,660.0 18.8
2005–2006 1,314.0 11,233.0 11.7
2006–2007 2,252.0 17,907.0 12.6
2007–2008 3,392.0 27,956.0 12.1
2008–2009 4,008.0 27,282.0 14.7
2009–2010 6,650.0 30,662.0 21.7
2010–2011 10,861.0 43,340.0 25.1
2011–2012 15,478.0 59,319.0 26.1
2012–2013 17,528.0 58,848.0 29.8
2013–2014 15,397.0 60,664.0 25.4
2014–2015 13,454.0 47,277.0 28.5
2015–2016 9,120.0 27,059.0 33.7
2016–2017 7,895.0 29,049.0 27.2

Sources: Petroleum Planning and Analysis Cell, Ministry of Petroleum and Natural Gas,
Government of India (ppac.org.in) and Export Import Data Bank, Ministry of Commerce, Government
of India (commerce.nic.in).

in 2016–2017, constituting 12.6 percent of India’s total exports of petroleum prod-

ucts. The decline in the value of India’s exports of naphtha is attributed to declin-
ing global oil prices as well as a reduction in market share.
Table 5 provides information on India’s exports of aviation turbine fuel (ATF)
and the accompanying figure 5 illustrates its share as a percentage of the country’s
petroleum products exports. AFT is a crude oil petroleum product used to power
aircrafts and also known as jet fuel. It has to meet strict guidelines for both the
mixture conditions required for power settings and to reduce fuel consumption. As
shown in table 5, India’s exports of ATF began in 2000–2001, were worth $38
million, and comprised 2.3 percent of India’s petroleum products exports that year.
India’s exports of ATF reached a maximum in 2013–2014, when exported ATF
82 THE JOURNAL OF ENERGY AND DEVELOPMENT

Figure 3
SHARE OF INDIA’S EXPORTS OF MOTOR SPIRIT IN COUNTRY’S PETROLEUM
PRODUCTS EXPORTS (AS A PERCENTAGE), 1999–2017

40
35
30
25
20
15
10
5
0

Share of Motor Spirit in India’s Petroleum Products Exports (%)

were valued at $5,487 million and represented 9 percent of India’s petroleum prod-
ucts exports in that year. Since then, India’s exports of ATF declined to $3,324
million in 2016–2017; however, AFT exports still accounted for 11.4 percent of
India’s petroleum products exports that year. The rise in share of ATF in India’s
petroleum products exports was due to faster declines in total exports of petroleum
products. However, the overall decline in the value of India’s ATF exports is
largely explained by the declining prices of petroleum oil and products.
The information about India’s exports of high speed diesel is provided in table
6 and the accompanying figure 6 illustrates its share as a percentage of the coun-
try’s petroleum products exports. The fuel used in compression ignition engines is
called diesel. High speed diesel (HSD) is normally used in an engine that runs
above 750 rpm such as in buses, locomotives, and trucks, etc. From table 6, one
can observe that India exported HSD worth $409 million in 2000–2001, which
was 24.4 percent of India’s exports of petroleum products in that year. Since then,
HSD exports have continued to increase reaching a peak of $24,336 million in
2013–2014, which represented 40.1 percent of the nation’s total petroleum prod-
ucts exports. However, India’s exports of HSD have since declined to $11,905 mil-
lion by 2016–2017, representing 41 percent of India’s petroleum products exports
in that year. The decline in the value of India’s HSD exports mainly has been due
to reduced petroleum crude and products prices worldwide.
 INDIA: A PETROLEUM PRODUCTS EXPORTER 83

Table 4
INDIA’S EXPORTS OF NAPHTHA, 1998–2017
Share of Naphtha in
India’s Exports of India’s Petroleum
India’s Exports of Petroleum Products Products
Year Naphtha ($ Millions) ($ Millions) Exports (%)
1998–1999 86.0 86.0 100.0
1999–2000 120.0 161.0 75.0
2000–2001 715.0 1,676.0 42.7
2001–2002 479.0 1,731.0 27.7
2002–2003 485.0 2,251.0 21.5
2003–2004 577.0 3,661.0 15.8
2004–2005 1,123.0 6,660.0 16.9
2005–2006 2,426.0 11,233.0 21.6
2006–2007 4,741.0 17,907.0 26.5
2007–2008 6,791.0 27,956.0 24.3
2008–2009 5,643.0 27,282.0 20.7
2009–2010 6,419.0 30,662.0 20.9
2010–2011 8,161.0 43,340.0 18.8
2011–2012 9,482.0 59,319.0 16.0
2012–2013 7,992.0 58,848.0 13.6
2013–2014 7,584.0 60,664.0 12.5
2014–2015 5,176.0 47,277.0 11.0
2015–2016 3,071.0 27,059.0 11.3
2016–2017 3,666.0 29,049.0 12.6

Sources: Petroleum Planning and Analysis Cell, Ministry of Petroleum and Natural Gas,
Government of India (ppac.org.in) and Export Import Data Bank, Ministry of Commerce, Government
of India (commerce.nic.in).

The data on India’s exports of fuel oil has been provided in table 7 and the
accompanying figure 7 displays its share as a percentage of the country’s petro-
leum products exports. Fuel oil is also known as marine fuel or furnace oil. It is
used in furnaces or boilers for the generation of heat. It is also used in engines for
power generation. India’s exported fuel oil was worth $70 million in 2000–2001,
which constituted 4.2 percent of India’s petroleum products exports that year.
Since then, fuel oil exports have increased reaching a height of $5,312 million in
2011–2012, constituting 9 percent of India’s exports of petroleum products that
year. However, fuel oil exports have subsequently and continuously experienced a
decline. By 2016–2017, India’s exports of fuel oil had declined to only $583
84 THE JOURNAL OF ENERGY AND DEVELOPMENT

Figure 4
SHARE OF INDIA’S EXPORTS OF NAPHTHA IN COUNTRY’S PETROLEUM PRODUCTS
EXPORTS (AS A PERCENTAGE), 1998–2017

120

100

80

60

40

20

Share of Naphtha in India’s Petroleum Products Exports (%)

million, which represented 2 percent of India’s exports of petroleum products that

year. The decline in India’s exports of fuel oil is explained by decreasing quantities
of fuel exports as well as decreasing global oil prices.

Direction of India’s Petroleum Products Exports and Its Competitors

India has been exporting its petroleum products globally. Table 8 provides
information about the direction of India’s exports of petroleum products to various
regions of the world and also to some countries of these regions. Figure 8 illustrates
the global scale and scope of India’s petroleum products exports. West Asia has
been the region to import the largest value of India’s petroleum products exports.
During 2015–2016, 26.3 percent of India’s exports of petroleum products were
exported to West Asia. However, those exports declined to 23.4 percent in
2016–2017. This was due to a steep decline in India’s petroleum products exports
to Saudi Arabia in 2016–2017 as compared to 2015–2016 and despite an increase
in India’s total petroleum products exports in 2016–2017 relative to 2015–2016.
Saudi Arabia has focused on increasing its production and exports of petroleum
products since 2017 to make up for cuts in OPEC determined quotas for its crude
oil production and exports.11 The United Arab Emirates (U.A.E.) was the second
 INDIA: A PETROLEUM PRODUCTS EXPORTER 85

Table 5
INDIA’S EXPORTS OF AVIATION TURBINE FUEL, 2000–2017
Share of Aviation
Turbine Fuel in
India’s Exports of India’s Exports of India’s Petroleum
Aviation Turbine Petroleum Products Products
Year Fuel ($ Millions) ($ Millions) Exports (%)
2000–2001 38.0 1,676.0 2.3
2001–2002 36.0 1,731.0 2.1
2002–2003 169.0 2,251.0 7.5
2003–2004 427.0 3,661.0 11.7
2004–2005 991.0 6,660.0 14.9
2005–2006 1,588.0 11,233.0 14.1
2006–2007 2,264.0 17,907.0 12.6
2007–2008 3,376.0 27,956.0 12.1
2008–2009 2,999.0 27,282.0 11.0
2009–2010 2,824.0 30,662.0 9.2
2010–2011 3,546.0 43,340.0 8.2
2011–2012 4,568.0 59,319.0 7.7
2012–2013 4,645.0 58,848.0 7.9
2013–2014 5,487.0 60,664.0 9.0
2014–2015 4,155.0 47,277.0 8.8
2015–2016 2,440.0 27,059.0 9.0
2016–2017 3,324.0 29,049.0 11.4

Sources: Petroleum Planning and Analysis Cell, Ministry of Petroleum and Natural Gas,
Government of India (ppac.org.in) and Export Import Data Bank, Ministry of Commerce, Government
of India (commerce.nic.in).

largest export market in 2016–2017 and largest market in 2015–2016 for imports
of Indian petroleum products. About 12.8 percent of India’s exports of petroleum
products in 2016–2017 were destined for the U.A.E. India’s exports of petroleum
products to Oman and Israel have also grown, making them important partners.
For both Oman and Israel, petroleum products were the largest Indian exports
item. Oman imported 4.3 percent of India’s petroleum products exports in
2016–2017 while Israel imported 3.5 percent in the same year.
The next important destination for India’s petroleum products exports has been
the member countries of the Association of Southeast Asian Nations (ASEAN).
About 20 percent of Indian exports of petroleum products went to the ASEAN
member countries. Among them, Singapore has been the largest market for India’s
86 THE JOURNAL OF ENERGY AND DEVELOPMENT

Figure 5
SHARE OF INDIA’S EXPORTS OF AVIATION TURBINE FUEL IN COUNTRY’S
PETROLEUM PRODUCTS EXPORTS (AS A PERCENTAGE), 2000–2017

16
14
12
10
8
6
4
2
0

Share of Aviation Turbine Fuel in India’s Petroleum Products

Exports (%)

exports of petroleum products. Petroleum products were also the largest commod-
ity in India’s exports to Singapore. Over 16 percent of India’s exports of petroleum
products during 2016–2017 went to Singapore. It should be mentioned that Singa-
pore is the region’s main trading hub for petroleum products. Moreover, India’s
petroleum products exports to Singapore are certainly re-exported to other coun-
tries.12 Petroleum products had been the largest item of India’s exports to Malaysia
representing about 3.1 percent of India’s petroleum products exports during
2016–2017.
India’s exports of petroleum products to Northeast Asia improved from 10.1
percent of India’s total petroleum products exports in 2015–2016 to 10.7 percent in
2016–2017. However, India’s exports of petroleum products to Japan faced sub-
stantial declines from 4.3 percent of India’s total petroleum products exports in
2015–2016 to 1.9 percent in 2016–2017. This was more than offset by a rise in
India’s exports of petroleum products to Korea, China, and Taiwan in 2016–2017
as compared to 2015–2016.13 Petroleum products constituted the largest item of
India’s exports to Japan, Korea, and Taiwan.
About 8 percent of India’s petroleum products exports were destined for Euro-
pean Union countries. The Netherlands imported 4.8 percent while France
imported 2.6 percent of India’s total exports of petroleum products during
2016–2017. Outside of the EU, Africa was also an importer of Indian petroleum
 INDIA: A PETROLEUM PRODUCTS EXPORTER 87

Table 6
INDIA’S EXPORTS OF HIGH SPEED DIESEL (HSD), 2000–2017
Share of HSD in
India’s Exports of India’s Exports of India’s Petroleum
High Speed Diesel Petroleum Products Products
Year ($ Millions) ($ Millions) Exports (%)
2000–2001 409.0 1,676.0 24.4
2001–2002 533.0 1,731.0 30.8
2002–2003 735.0 2,251.0 32.7
2003–2004 1,475.0 3,661.0 40.3
2004–2005 2,627.0 6,666.0 39.4
2005–2006 4,189.0 11,233.0 37.3
2006–2007 6,427.0 17,927.0 36.0
2007–2008 10,178.0 27,956.0 36.4
2008–2009 11,032.0 27,282.0 40.4
2009–2010 10,747.0 30,662.0 35.0
2010–2011 15,220.0 43,340.0 35.1
2011–2012 21,746.0 59,319.0 36.7
2012–2013 21,253.0 58,848.0 36.1
2013–2014 24,336.0 60,664.0 40.1
2014–2015 18,865.0 47,277.00 40.0
2015–2016 10,180.0 27,059.0 37.6
2016–2017 11,905.0 29,049.0 41.0

Sources: Petroleum Planning and Analysis Cell, Ministry of Petroleum and Natural Gas,
Government of India (ppac.org.in) and Export Import Data Bank, Ministry of Commerce, Government
of India (commerce.nic.in).

products. East Africa received 7.7 percent of India’s petroleum products in

2016–2017, which was a decline from 10.8 percent in 2015–2016. Exports of
petroleum products from India to East Africa declined from 10.8 percent of total in
2015–2016 to 7.7 percent in 2016–2017. East Africa could prove to be a good mar-
ket for India’s exports of petroleum products as the region lacks sufficient refining
capacity. Kenya imported 5.7 percent of India’s petroleum products exports in
2015–2016. Kenya’s landlocked neighbors Uganda, Rwanda, and Burundi also
imported Indian petroleum products through Kenya. Reliance India Limited (RIL),
through its subsidiary Gulf Africa Petroleum Corporation (GAPCO), was the main
source of India’s petroleum products exports to Kenya.14 However, exports of
petroleum products from India to Kenya declined substantially in 2016–2017. Tan-
zania imported 3.2 percent of India’s petroleum products during 2016–2017.
88 THE JOURNAL OF ENERGY AND DEVELOPMENT

Figure 6
SHARE OF INDIA’S EXPORTS OF HIGH SPEED DIESEL (HSD) IN COUNTRY’S
PETROLEUM PRODUCTS EXPORTS (AS A PERCENTAGE), 2000–2017

45
40
35
30
25
20
15
10
5
0

Share of HSD in India’s Petroleum Products Exports (%)

The Line of Credit (LoC) that has been extended from time to time by the EXIM
Bank of India has helped Indian exports of petroleum products to Tanzania
grow.15 Petroleum products was the largest item of India’s exports to Mauritius
and constituted 1.7 percent of India’s total petroleum products exports in
2016–2017. The Mangalore Refinery and Petrochemicals Ltd. (MRPL) has been
supplying petroleum products to Mauritius since 2006.16
Outside of Africa, India’s exports of petroleum products even expanded to the
United States, a large petroleum producer itself, where Indian exports to that nation
stood at 6.4 percent of India’s total petroleum products exports during 2016–2017.
Thus, the United States also has been an important market for the export of India’s
petroleum products. Indian oil companies have been able to export petroleum prod-
ucts to the United States as Indian refiners were able to produce high quality
Euro-IV and Euro-V petrol and ultra-low sulphur diesel.17
India’s exports of petroleum products to its neighboring countries in South Asia
constituted 4.7 percent of the total exports of this commodity during 2016–2017.
India’s exports of petroleum products to Nepal were the largest single item and
constituted 2.6 percent of the total during 2016–2017. Compared to 2015–2016,
India’s exports of petroleum products to Nepal increased considerably during
2016–2017.18 Petroleum products were also the largest single export item from
India to Sri Lanka and constituted 1.6 percent of India’s total exports of petroleum
 INDIA: A PETROLEUM PRODUCTS EXPORTER 89

Table 7
INDIA’S EXPORTS OF FUEL OIL, 2000–2017
Share of Fuel Oil in
India’s Exports of India’s Petroleum
India’s Exports of Petroleum Products Products
Year Fuel Oil ($ Millions) ($ Millions) Exports (%)
2000–2001 70.0 1,676.0 4.2
2001–2002 53.0 1,731.0 3.1
2002–2003 178.0 2,251.0 8.0
2003–2004 204.0 3,661.0 5.6
2004–2005 338.0 6,660.0 5.1
2005–2006 522.0 11,233.0 4.6
2006–2007 1,101.0 17,907.0 6.1
2007–2008 1,696.0 27,956.0 6.1
2008–2009 2,737.0 27,282.0 10.0
2009–2010 2,250.0 30,662.0 7.3
2010–2011 3,318.0 43,340.0 7.6
2011–2012 5,312.0 59,319.0 9.0
2012–2013 3,757.0 58,848.0 6.4
2013–2014 3,671.0 60,664.0 6.1
2014–2015 2,321.0 47,277.0 5.0
2015–2016 688.0 27,059.0 2.5
2016–2017 583.0 29,049.0 2.0

Sources: Petroleum Planning and Analysis Cell, Ministry of Petroleum and Natural Gas,
Government of India (ppac.org.in) and Export Import Data Bank, Ministry of Commerce, Government
of India (commerce.nic.in).

products during 2016–2017. India responded quickly to Sri Lanka’s request for
fuel at the time of the 2017 crisis and sent fuel shipped from the Praadip Refinery
in Orissa.19 Moreover, India has been exporting diesel to Myanmar. The Numali-
garh Refinery has partnered with Parami Energy Group of Myanmar for the supply
of diesel. Thus, India’s neighbor Myanmar could develop into an important market
for exports of India’s petroleum products.20 Additionally, the Numaligarh refinery
has been supplying diesel to Bangladesh.
The export of petroleum products to Bangladesh is reported to be aligned with
the “Neighbourhood First Policy” of the Indian government to boost bilateral trade
and sub-regional cooperation within the South Asian Association for Regional
Cooperation (SAARC) group.21 The diesel is exported to Bangladesh by train to
Parbatipur in the Dinajpur district located in northern Bangladesh. Then the diesel
90 THE JOURNAL OF ENERGY AND DEVELOPMENT

Figure 7
SHARE OF INDIA’S EXPORTS OF FUEL OIL IN COUNTRY’S PETROLEUM PRODUCTS
EXPORTS (AS A PERCENTAGE), 2000–2017

12

10

Share of Fuel Oil in India’s Petroleum Products Exports (%)

is transported by a combination of road and river transport to the end consumer

markets in north Bangladesh. This is beneficial to Bangladesh as it currently
imports petroleum products through the Chittagong sea port in the south of Bangla-
desh, which saves the country the logistical and financial costs related to transport-
ing products from the south to the northern end users. India and Bangladesh have
signed a long-term deal to construct a 135-kilometer friendship pipeline from Sili-
guri in India to Parbatipur in Bangladesh. It is expected that this would help the
Numaligarh refinery to achieve economies of scale and reduce the landed cost of
petroleum products to Bangladesh, making it a win-win deal for both nations.22
This could help to facilitate Bangladesh becoming a major market for India’s
petroleum products exports.
India also has been exploring options to export petroleum products to Pakistan
to help meet that nation’s energy requirements and to find a new market for Indian
refiners. Pakistan was reported to be interested in importing petroleum products
from India to reduce costs.23 If this potential trade opportunity turns into a reality,
Indian refineries in cities such as Bhatinda and Panipat in the north and Jamnagar
in the west would be able to supply petroleum products to Pakistan. Pakistan
imports a significant part of its petroleum products requirements as its refining
capacity is much below its domestic demand. Any deal in this context would be
mutually beneficial for the two countries.24
 INDIA: A PETROLEUM PRODUCTS EXPORTER 91

Table 8
INDIA’S EXPORTS OF PETROLEUM PRODUCTS TO VARIOUS REGIONS
(in $millions)
Region/ Country 2015–2016 Percent 2016–2017 Percent
WEST ASIA 7,115.22 26.3 6,797.32 23.4
United Arab Emirates 3,715.08 13.7 3,723.95 12.8
Oman 1,016.83 3.8 1,259.86 4.3
Saudi Arabia 1,417.10 5.2 457.63 1.6
Israel 804.06 3 1,017.64 3.5
ASEAN 3,775.15 14 6,030.64 20.8
Singapore 2,941.28 11 4,691.52 16.2
Malaysia 376.93 1.4 908.42 3.1
NORTH EAST ASIA 2,722.99 10.1 3,098.72 10.7
Japan 1,176.03 4.3 563.48 1.9
Korea RP 551.1 2 955.85 3.3
China 614.99 2.3 783.87 2.7
Taiwan 324.79 1.2 655.91 2.3
EUROPEAN UNION 2,260.89 8.4 2,284.27 7.9
Netherland 1,043.72 3.8 1,408.29 4.8
France 714.94 2.6 747.63 2.6
EAST AFRICA 2,920.10 10.8 2,247.50 7.7
Kenya 1,538.86 5.7 765.6 2.6
Tanzania 782.39 2.9 943.22 3.2
Mauritius 522.62 1.9 483.8 1.7
NORTH AMERICA 2,067.93 7.6 1,866.01 6.4
United States 2,067.52 7.6 1,864.61 6.4
SOUTH ASIA 1,240.84 4.6 1,488.75 5.1
Nepal 497.12 1.8 764.04 2.6
Sri Lanka 567.21 2.1 456.64 1.6
EAST ASIA (OCEANIA) 1,157.27 4.3 701.32 2.4
Australia 1,154.30 4.3 698.61 2.4
OTHERS 3,798.61 14 4,535.47 15.6
TOTAL 27,059.00 100 29,049.00 100

Sources: Petroleum Planning and Analysis Cell, Ministry of Petroleum and Natural Gas,
Government of India (ppac.org.in) and Export Import Data Bank, Ministry of Commerce, Government
of India (commerce.nic.in).
a
Petroleum products as defined by harmonized system code HS-2710.

Thus, the neighboring countries of South Asia are important potential markets
for India’s petroleum products exports. The bright side of this arrangement is that
it would be commercially viable for the South Asian importers as well. India’s
exports of petroleum products comprise the single greatest item of India’s exports
to Australia. India’s exports of petroleum products to Australia represented
92 THE JOURNAL OF ENERGY AND DEVELOPMENT

Figure 8
INDIA’S PETROLEUM PRODUCT EXPORTS AT A REGIONAL LEVEL, 2016–2017
(AS A PERCENTAGE OF TOTAL)

East Asia Others,

(Oceania), 2.40% 15.60% West Asia,
23.40%
South Asia, 5.10%
North America,
6.40% ASEAN,
20.80%
East Africa,
7.70%
European Union, North East Asia, 10.70%
7.90%

4.3 percent and 2.4 percent of total exports of petroleum products during
2015–2016 and 2016–2017, respectively. It should be noted that many of Austral-
ia’s ageing refineries were either closed down or converted into fuel terminals.
This has resulted in increasing imports of petroleum products since 2015,25 which,
in turn, provides an expanded market to the exporters of petroleum products
including Indian refiners. Thus, it is found that India has been able to export its
petroleum products to countries, both near and far, like Singapore, United Arab
Emirates, Oman, Saudi Arabia, Israel, Korea, China, the Netherlands, Tanzania,
the United States, Australia, and neighboring South Asian countries.
Referring back to table 2, which provides information about the annual value of
India’s exports of petroleum products, we see that the maximum value during the
evaluation of this study was reached in 2013–2014. During this year, India
exported petroleum products were worth $60,664 million. However, the value of
the nation’s petroleum products exports declined very shortly thereafter to its mini-
mum value under our study’s time frame under investigation to $27,059 million in
2015–2016. Thereafter, the value increased to $29,049 million in 2016–2017.
Thus, during the period 2013–2014 to 2016–2017, India’s exports of petroleum
products declined substantially—by over 55 percent. We can attribute this decline
to three main factors.
The first factor was the steep decline in global oil prices during these years. The
average crude oil price was $105.52 per barrel during 2013–2014; with oil prices
declining to $46.19 per barrel in 2015–2016 and then rising to $47.56 per barrel
during 2016–2017.26 Thus, during the period from 2013–2014 to 2016–2017, oil
prices declined by over 56 percent. This is reflected substantially in the declining
revenues of India’s exports of petroleum products. Normally, falling oil prices are
 INDIA: A PETROLEUM PRODUCTS EXPORTER 93

considered a boon to the Indian economy as India’s bill for crude oil imports also
falls with declining oil prices. India’s expenditures on crude oil declined from
$1,42,962 million in 2013–2014 to $63,972 million in 2015–2016; however, it
increased to $70,196 million in 2016–2017.27 Thus, between 2013–2014 to
2016–2017, India’s import expenditures on crude oil declined by about 51 percent.
Therefore, there is no doubt that the declining oil prices were beneficial for both
India’s balance of trade and balance of payments. However, there is another aspect
to this phenomenon that one must consider. Declining oil prices also result in
reduced earnings on account of India’s largest export item, that is, petroleum prod-
ucts. It has already been observed that during the period 2013–2014 to 2016–2017,
India’s revenue earnings generated from its largest export item—petroleum prod-
ucts—declined by 55 percent. This is a setback for the Indian economy and one of
the crucial factors for the contraction in India’s export earnings during this period.
The second factor attributable to the reduction of India’s exports of petroleum
products is the decline in the quantity of India’s exports of petroleum products.28 It
is reported that India’s exports of petroleum products declined from 67.86 million
metric tons in 2013–2014 to 60.54 million metric tons in 2015–2016. Thus, during
this period India’s exports of petroleum products declined by 11 percent. However,
this improved to 65.51 million metric tons in 2016–2017 but remained much below
the 2013–2014 level.29
The third factor responsible for the contraction of India’s petroleum products
exports was a decline in India’s market share of global petroleum products exports.
We find that India’s petroleum products exports during the period of our study
declined despite increases in the nation’s petroleum products exports to global mar-
kets. It is reported that India was the fifth largest exporter of petroleum products in
the world during 2016, exporting $27 billion worth of petroleum products while
global exports amounted to $504 billion in 2016. Thus, India’s petroleum products
exports constituted 5.3 percent of this commodity’s global exports.30 However,
India became the tenth largest exporter of petroleum products in the world during
2017. India exported $24.1 billion worth of petroleum products, while the global
exports amounted to $626.5 billion in 2017. Thus, India’s exports of petroleum
products constituted 3.9 percent of total global exports in 2017.31 Hence, we find
that despite expansion in the global market for petroleum products during the
above period, India’s exports of petroleum products contracted, which resulted in
India’s ouster as the fifth largest exporter of petroleum products to tenth during the
above time period. It was also reported that as compared to the year 2013, the
value of Saudi Arabia’s petroleum products exports increased by over 66 percent
in 2017 and that of China’s by over 4 percent in the same period. During this same
time frame the value of India’s petroleum products exports declined by 64 per-
cent.32 Consequently, it is clear that India ceded its market share to countries like
Saudi Arabia and China in terms of global petroleum products exports.33 It should
be mentioned that Saudi Arabia had to reduce its crude oil exports due to OPEC
94 THE JOURNAL OF ENERGY AND DEVELOPMENT

production agreements. Saudi Arabia successfully adopted the strategy of increas-

ing its petroleum products exports to offset the impact of a reduction to its crude
oil exports.34 Adding additional competition, Chinese petroleum companies were
reported to have flooded the global petroleum products market with their refined
products including diesel and gasoline. The jump in Chinese exports of petroleum
products was attributed to the high refinery output of petroleum products.35 Not
only India but other traditional exporters of petroleum products were facing tough
competition from the Chinese to increase their market share in the South East
Asian and Australian markets.36 It was reported that high production by indepen-
dent refineries, also known as teapots, resulted in record production of Chinese
petroleum products. The attractive export margins and positive growth in petro-
leum products demand in the nearby markets provided China with incentives to
enhance its exports.37

Refining Capacity, Domestic Demand, Administered Price Mechanism (APM)

Regime and India’s Petroleum Products Exports

India had one of oldest refineries established in its part of the world. The Digboi
refinery was established in 1901 by the Assam Oil Company Limited with installed
capacity of 0.5 million metric ton per annum (MMTPA). Since then, the facility
has been modernized and its capacity has also been increased. After India’s inde-
pendence many refineries were established all over the country mainly to cater to
domestic demand. These refineries were public-sector controlled as the private sec-
tor was not allowed to participate in this key part of the energy value chain.
Among these refineries, Mangalore Refinery, Numaligarh Refinery, and Praadip
Refinery have been involved in exportation of petroleum products from India. At
present India has 23 refineries with 18 in the public sector, 3 in the private sector,
and 2 joint ventures. India began to liberalize its economy in 1991. However, no
refinery in the private sector could be established until the late 1990s. Since the
1990s, the foreign investment regime has been significantly liberalized. After this
liberalization, all private sector refining projects were permitted and may be 100
percent foreign owned. However, in the case of public-sector refineries, foreign
equity must be approved by the Foreign Investment Promotion Board (FIPB) and
cannot exceed 49 percent of total ownership.38 Furthermore, to encourage invest-
ment, the Indian government introduced the establishment of Special Economic
Zones (SEZs) and Export Oriented Units (EOUs). SEZs are legally deemed foreign
territories in order to avoid a multiplicity of domestic duties and tariffs along with
numerous controls and authorizations. EOUs differ from SEZs in that any corpora-
tion exporting over 75 percent of its production is qualified to become an EOU.
Under the EOU scheme, corporations are permitted to purchase all goods required
to produce exports free of all duties—excise, custom duties, states levies, etc.39
 INDIA: A PETROLEUM PRODUCTS EXPORTER 95

With the changed investment regime, Reliance Industries established the world’s
largest refinery—Jamnagar I—with 33 MMTPA refining capacity in 1999. Reli-
ance also set up another refinery, Jamnagar 2, with 27 MMTPA refining capacity
in the SEZ. This refinery is also among one of the largest in the world.40 At the
same time the construction of Essar Oil refinery was started at Vadinar, Gujarat.
At present, the Essar Refinery has a capacity of 20 MMTPA. Hence, out of India’s
total refining capacity of about 240 MMPTA, private sector refining capacity is 80
MMTPA.41 Therefore one-third of India’s refining capacity is based in the private
sector. These private-sector refineries produce the cleanest fuels, which meet Euro
5 standards and are exported to the United States and European countries. The
public-sector refineries produce a slightly lower fuel grade and export mostly to
neighboring and other developing countries.42
The total production of petroleum products in India during 2016–2017 was
reported at 243.6 MMTPA. Of this about 240 million metric tons (MMT) was pro-
duced by Indian refineries with the remaining by fractionators. The total consump-
tion of petroleum products in India during 2016–2017 was about 194 MMT while,
during the same year, Indian exports of petroleum products was around 66
MMT.43 Taken together, this amounts to 260 MMT of products, which implies
that petroleum products produced in India well exceeded requirements for domes-
tic consumption. What we find is that although surplus production was available
for exports, the overall petroleum products production level alone was not enough
to sustain the observed level of both domestic consumption and exports. Hence,
this had to be supported by imports. This also means that any rise in domestic
demand would reduce the availability of petroleum products for exports from
India. While India has the fourth largest refining capacity in the world, it is also
one of the fastest growing economies in the world. This makes the domestic
demand for petroleum products in India ever increasing. The decline in exports of
petroleum products from India has also been attributed to the increase in domestic
demand of petroleum products such as petrol, diesel, and naphtha.44 Therefore, the
increase in refining capacity in India must be faster than the growth in domestic
demand for petroleum products if India wants to continue to be an exporter of this
valued commodity. The Indian government is well aware of this issue and is plan-
ning to increase the nation’s refining capacity not only to meet increasing domestic
demand but also to cater to export market demands. According to government
sources, India plans to expand its refining capacity to 600 MMTPA from the pre-
sent 240 MMTPA.45 However it is not an easy task to more than double the coun-
try’s refining capacity as it requires massive investment by public sector oil
companies and also by private and foreign investors.
Yet another important issue that would affect India’s petroleum products
exports would be the policy of petroleum products pricing in India. Historically,
India followed the system of Administered Pricing Mechanism (APM) in which
domestic prices of petroleum products were fixed by the central government of
96 THE JOURNAL OF ENERGY AND DEVELOPMENT

India. After the nationalization of the oil industry in 1974, India had adopted this
system of pricing for petroleum products. Through this system, India maintained
price controls over petrol, diesel, liquefied petroleum gas, and kerosene oil. The
objective of these controls obviously had been to insulate the consumers and the
Indian economy against high global crude oil prices and volatility.46 However, due
to frequent and steep hikes in global crude oil prices, the oil marketing companies in
India have faced massive under-recoveries. The under-recoveries are estimated as the
difference between the cost price and the regulated price at which petroleum products
are finally sold to the retailers by Indian OMCs, after taking into account the subsidy
paid by the government.47 In the wake of liberalization and reform policy being
implemented in India, the petroleum sector also has been targeted for reforms. The
APM has proved to be a burden for the OMCs as well as the Indian government.
The government of India began the elimination of the APM in 1998 with the sys-
tem’s removal implemented in a gradual manner so as not to shock the system or
consumers. Concurrent to this, private and foreign investment were permitted and
encouraged in the petroleum sector.48 This also resulted in the establishment of huge
refineries by Reliance and Essar Oil with these companies setting up retail outlets all
over the country. The APM was finally dismantled in 2002. However, this was short
lived. With the rise in global oil prices in 2004, the Indian government reinstated the
APM. However, private sector oil marketing companies were not supportive of this
reinstatement of subsidies that resulted in their retail operations becoming financially
unviable.49 The private sector refineries had to revert to exporting their petroleum
products, which could be sold at higher global market prices in external markets, in
order to offset the stoppage of their products in domestic retail sales. RIL even sought
and received the status of Export Oriented Unit (EOU) for its second refinery. Thus,
it is clear why the private sector dominates the Indian petroleum products exports.
During 2015–2016 the share of private refiners in India’s exports of petroleum
products was 90 percent.50 However, the APM regime again has been dismantled.
The petro pricing was deregulated in 2010 and diesel pricing was deregulated in
2014. With the end of the APM era, the private refiners are once again becoming
active players in the domestic market by reviving their dormant retail outlets. As
the domestic markets become viable for private oil companies, it is expected that a
fair proportion of their products would be diverted to domestic markets from the
export market. It has already been observed that Reliance Industries exports of
petroleum products decreased in the first quarter of 2016–2017 because of
increased domestic demand.51 The same trend was reported from Essar too. Essar
has been planning to increase its domestic retail sales outlets to over 5,000 fuel sta-
tions by 2017–2018. The hike in local sales by Essar was estimated to shrink its
exports to 25 percent in 2017–2018 from 45 percent of its petroleum products out-
put during 2015–2016.52 This could result in a slowdown or even decline in the
growth of India’s exports of petroleum products. This trend cannot be controlled in
a deregulated market by the government. One option available to policy makers
 INDIA: A PETROLEUM PRODUCTS EXPORTER 97

could be to encourage establishment of private sector refineries as Export Oriented

Units (EOU). Another policy option would be to attract the private sector to setup
refineries in the Special Economic Zones (SEZs). Thus, Indian government policy
makers must seek ways to incentivize petroleum products producers to avoid con-
traction of the country’s market share in global petroleum products exports and
resulting expansion of market shares of competing nations at the cost of Indian
exports of petroleum products.

Conclusion

The Indian government must manage an important balancing act when it comes
to both petroleum products exports and meeting domestic needs. The nation must
produce enough petroleum products to fuel its fast-growing economy and meet the
needs of its populace; at the same time, it has become an important petroleum
exporter to the world and these exports are incredibly valuable to India’s overall
economy. India has the fourth largest refining capacity in the world, but it must
increase its investment in this capacity to keep pace with domestic needs and at a
price that is still affordable. Since India became a net exporter of petroleum prod-
ucts in 2001–2002, it has expanded its exports to countries around the world
including Asia, Africa, Europe, and North America. These trading ties are not only
commercial but also have greater geo-political implications and expand India’s
presence, prestige, and influence on a global scale.
One cannot understate the importance of petroleum products to India’s export port-
folio. Since 2006–2007, petroleum products (classified as HS-2710) have remained
the largest single category item among India’s exports. During 2013–2014 exports of
petroleum products from India reached a height of $60,664 million, constituting about
one-fifth of India’s total exports. These high-value exports consisted of motor spirit,
naphtha, aviation turbine fuel, high speed diesel, and fuel oil. However, the nation’s
emergence as a petroleum products powerhouse has only been in the aftermath of cru-
cial and prudent government reforms in the petroleum sector. Critical to these efforts
was the granting of permission for private and foreign investment in the petroleum
sector, which has resulted in the establishment of private-sector refineries. Most nota-
ble among these private-sector entities are the Reliance and Essar refineries, which
together account for one-third of India’s total refining capacity. Moreover, these
private-sector refineries have been the mainstays of India’s petroleum products
exports, constituting 90 percent of India’s total petroleum product exports. The surplus
refining capacity and the administered petroleum products were crucial factors in
India’s exports of this valuable global commodity. A key takeaway from our research
is that increasing domestic demand and the dismantling of the APM regime have, to a
great extent, adversely affected India’s exports of petroleum products as private refin-
ers are gradually shifting their sales to the domestic market. This paper recommends
98 THE JOURNAL OF ENERGY AND DEVELOPMENT

that, in order for India to maintain and potentially increase its market share of petro-
leum products exports globally while meeting domestic demands that fuel the nation’s
robust economic growth, more refining capacity must be added and that can be facili-
tated by setting up more refineries as Export Oriented Units (EOUs) or in the Special
Economic Zones (SEZs).

NOTES
1
World Bank, World Development Indicators Data Base (Washington, D.C.: World Bank,
2017).
2
Ibid.
3
International Energy Agency (IEA), Key World Energy Statistics (Vienna: IEA, 2017), avail-
able at www.iea.org/statistics/.
4
Ibid.
5
Government of India, Ministry of Petroleum and Natural Gas, Indian Petroleum and Natural
Gas Statistics 2016-17 (New Delhi: Government of India, 2017).
6
P. Lakshmi, India a Net Exporter of Petroleum Products since 2001-02 (New Delhi: Press
Information Bureau, Ministry of Petroleum and Natural Gas, Government of India, April 23,
2017), available at http://pib.nic.in/newssite/.
7
Government of India, Ministry of Petroleum and Natural Gas, Indian Petroleum and Natural
Gas Statistics 2016-17.
8
D. Workman, Refined Oil Exports by Country, May 1, 2017, available at www.worldstopex-
ports.com/refined-oil-exports-by-country/.

V. S. Mehta, “Over the Barrel: How India Reformed its Petroleum Sector,” The Indian
9

Express, August 1, 2016.

10
P. Lakshmi, op. cit.

“Saudi Shifts Exports Focus from Crude to Products,” Middle East Economic Survey
11

(MEES), vol. 61, no. 8, February 23, 2018, p. 1.

“Singapore Leading Hub for Oil Products and Gas Trade,” Oil & Gas News (OGN), vol. 35,
12

issue no. 7, July 2018.

C. Russel, “Refinery Wars: China, India Win, South Korea, Japan, Singapore Lose,” Reuters,
13

August 29, 2016.

“Kenya Oil Product Imports Likely to Hit Record, Offset Tepid Asia Demand,” Reuters,
14

May 11, 2015.

D. Sachin, “Tanzania Signs a $268 Million Agreement with EXIM Bank,” The Economic
15

Times, June 26, 2015.

R. Mishra, “STC Mauritius Renews Contracts to Buy Petro Products from MRPL,” The
16

Hindu Business Line, August 7, 2013.

 INDIA: A PETROLEUM PRODUCTS EXPORTER 99
17
Reliance Industries Ltd. (RIL), RIL Annual Report, (2009-10) (Mumbai: Reliance Industries
Ltd., 2010).
18
“Indian Oil Exports to Nepal Rising,” The Hindu Business Line, August 23, 2017.
19
“India Sends Fuel Shipment to Sri Lanka,” The Hindu, November 8, 2017.
20
G. C. Prasad, “India Starts Exporting Petroleum Products to Myanmar,” Livemint, September
4, 2017.
21
“India Starts Diesel Export to Bangladesh via Rail,” Deccan Chronicle, March 17, 2016.
22
P. R. Bose, “Can India Sustain Diesel Export to Bangladesh?” The Hindu, March 27, 2016.
23
“India to Export Fuel to Pakistan,” The Express Tribune, April 26, 2011.
24
“Exporting Petroleum Products to Neighbors,” Dawn, May 1, 2011.
25
“Australia’s 2015 Oil Product Imports to Soar after Ageing Refinery Closures,” Reuters,
April 13, 2015.

“Crude Oil Price (Indian Basket),” Petroleum Planning and Analysis Cell, Ministry of Petro-
26

leum and Natural Gas, Government of India.

27
Ibid.

S. Saikia, “India-4th Largest Refiner in the World-Sees Fall in Exports of Petroleum

28

Products,” The Financial Express, May 7, 2016.

29
Government of India, Ministry of Petroleum and Natural Gas, Indian Petroleum and Natural
Gas Statistics 2016-17 (New Delhi: Economic and Statistics Division, Ministry of Petroleum and
Natural Gas, Government of India, September 2017).
30
D. Workman, “Refined Oil Exports by Country,” World’s Top Exports website, May 1,
2017.

D. Workman, “Refined Oil Exports by Country,” World’s Top Exports website, June 3,
31

2018.
32
Ibid.

V. Srivastava, “Indian Refiners Set to Slip as Chinese Petro Products Exports Soar,” The
33

Financial Express, May 3, 2017.

“Saudi Arabia’s Shift Up the Value Chain Offsets 7-Year Crude Export Low,” Middle East
34

Economic Survey (MEES), vol. 61, no. 4, January 26, 2018, p. 10.
35
O. Zhou, “Analysis: China’s Oil Product Export Set to Break All Records,” S&P Global
Platts, July 21, 2016.
36
“Global Refiners Brace as China Cements Its Oil Market Sway,” The Hindu, August 5, 2017.
37
The Bahamas Maritime Authority, “China’s Gasoline, Diesel Export to Stay High Over H2
2017,” Hellenic Shipping News Worldwide, July 26, 2017.
100 THE JOURNAL OF ENERGY AND DEVELOPMENT
38
K. Clarke and D. Graczyk, “India’s Downstream Petroleum Sector,” IEA Working Paper,
Paris, International Energy Agency (IEA), 2010, p. 21.
39
Ibid.
40
www.ril.com.
41
www.essar.com.
42
V. Hari, “India’s Energy Sector Looks Sturdy in 2016,” Livemint, www.livemint.com.
43
“Trends in Indian Petroleum Industry at a Glance,” in Indian Petroleum and Natural Gas
Statistics 2016-17 (New Delhi: Economic and Statistics Division, Ministry of Petroleum and Natu-
ral Gas, Government of India, September 2017).

S. Saikia, “India – 4th Largest Refiner in the World – Sees Fall in Export of Petrol
44

Products,” The Financial Express, May 7, 2016.

“India to Double its Refining Capacity: Petroleum Minister Dharmendar Pradhan,” The Eco-
45

nomic Times, April 20, 2017.

46
G. Gouri, Pricing for Welfare: Petroleum Products in India (New Delhi: Oxford and IBH
Publishing, 1989), p . 38.
47
International Energy Agency (IEA), Petroleum Prices Taxation and Subsidies in India (Paris:
OECD/IEA, June 2009), p. 6.
48
V. S. Mehta, op. cit.
49
International Energy Agency (IEA), Petroleum Prices Taxation and Subsidies in India.
50
Business Standard, April 26, 2016; www.ril.com; www.essar.com; and Government of India,
Ministry of Petroleum and Natural Gas, Indian Petroleum and Natural Gas Statistics 2016–17
(New Delhi: Ministry of Petroleum and Natural Gas, Government of India, New Delhi, September
2017).
51
J. Mukul, “Reliance’s Fuel Exports Dip below 10 million Tonnes in April-June,” Business
Standard, July 16, 2016.
52
N. Verma, “Essar Oils’s Fuel Exports to Fall in 2018/19 as Focus Shifts to Local Sales,”
Reuters, August 7, 2016.