Latest news with #India-Saudi
Time of India
5 days ago
- Business
- Time of India
From big plans to bottlenecks: Refining expansion falters, capacity up just 5%; import dependence grows
Representative Image India has increased its oil refining capacity by only 5% over the past seven years, falling far short of the 69% growth that had been targeted for 2025. Factors such as uncertainty around future demand due to climate considerations, limited land availability, and disruptions from the COVID-19 pandemic have significantly slowed expansion efforts. This shortfall has further heightened India's reliance on imported energy. A 2018 report by an oil ministry panel, which included government officials and industry leaders, had projected that refining capacity would grow from 245 million tonnes per annum (mtpa) in 2017-18 to 414 mtpa by 2025 and 439 mtpa by 2030, based on what were then considered "firm plans" by refiners, according to ET. However, the current capacity stands at just 258 mtpa, according to the figures put out by the oil ministry. Key projects that have fallen behind include the proposed 60 mtpa India-Saudi greenfield joint venture, Nayara Energy's 25 mtpa expansion backed by Rosneft, Reliance Industries' planned 7.5 mtpa addition, and Indian Oil's 34 mtpa capacity goal. The combined refining capacity of BPCL and NRL has increased by just 2 million tonnes per annum (mtpa), falling significantly short of the planned 26.4 mtpa expansion by 2025. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like An engineer reveals: One simple trick to get internet without a subscription Techno Mag Learn More Undo Meanwhile, the HPCL-ONGC group registered the largest capacity addition among all players, with an 11 mtpa increase - but still below its target of 23 mtpa. Several projects led by Indian Oil and HPCL are currently under construction and are expected to be completed in the coming years. Major refiners, including Indian Oil, HPCL, BPCL, Reliance Industries, and Nayara Energy, haven't commented on the delays or revised timelines. The sluggish pace of expansion, combined with rising domestic fuel demand, has led to a 43% increase in India's petroleum product imports over the past seven years (up to 2024 - 25), while export volumes have slipped by 3% during the same period. B Ashok, former chairman of Indian Oil, says the uncertainty over the impact of energy transition policies, both in India and globally, has 'made decision-makers more circumspect'. He acknowledged that refineries are 'high capex and high gestation projects' but stressed that India urgently needs fast-executed greenfield refinery projects to support its rapidly growing economy. According to him, such projects must integrate new technologies to address environmental concerns and be supported by new risk-sharing models, reported ET. B Anand, former CEO of Nayara Energy and of the TCG Group's petrochemical business, also agrees that the shadow of transition looms over refinery growth. 'Globally, the refining growth story is diminishing. Access to new-age capital for hydrocarbons due to net zero concerns has reduced,' he said. Ashok added that climate-focused initiatives are creating competing demands for capital within energy companies. 'With emphasis on transition and climate impact mitigation efforts, the capital requirements within the organisations are varied and stretched. These are also impacting the view of future refining projects,' said Ashok, who also headed the India-Saudi joint venture refinery project, which ultimately stalled due to land acquisition issues. Anand believes India should shift its focus toward petrochemicals, given the anticipated rise in demand driven by rapid urbanisation and the growth of e-commerce. 'For India, building new refineries with so much crude import dependence is not a good idea. We should instead focus on investing in petrochemicals, which has a promising future,' he added. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
5 days ago
- Business
- Time of India
On slippery ground: Refining capacity rises just 5% in 7 years
India has added just 5 per cent to its refining capacity over the past seven years—a sharp contrast to the 69 per cent expansion originally planned by 2025. A mix of climate-related demand uncertainty, land constraints, and the pandemic has slowed progress, further deepening the country's dependence on energy imports. India's refining capacity was projected to rise from 245 million tonnes per annum (mtpa) in 2017-18 to 414 mtpa by 2025 and 439 mtpa by 2030, according to a 2018 report by an official panel of oil ministry officials and industry executives, which based its projection on 'firm plans' by refiners. The refining capacity, however, has risen to just 258 mtpa, according to oil ministry data. The major misses included the India-Saudi 60 mtpa greenfield joint venture project, Rosneft-backed Nayara Energy's 25 mtpa expansion, Reliance Industries' 7.5 mtpa addition, and Indian Oil's 34 mtpa target. The BPCL-NRL combined capacity expanded by 2 mtpa, compared to a projected 26.4 mtpa by 2025, while the HPCL-ONGC group achieved an 11 mtpa increase—the largest by any group—against its 23 mtpa target. Some expansion projects, including those by Indian Oil and HPCL, are under construction and expected to come online over the next few years. Indian Oil, HPCL, BPCL, RIL, and Nayara declined to comment. Slower expansion, coupled with surging domestic demand, has pushed up India's imports of petroleum products by 43 per cent in seven years to 2024-25, while exports have declined by 3 per cent in volume terms. B Ashok, former chairman of Indian Oil, says the uncertainty over the impact of energy transition policies, both domestically and globally, has 'made decision-makers more circumspect'. While acknowledging that refineries are 'high capex and high gestation projects', he warned that India needs fast-executed greenfield refinery projects to support its rapidly expanding economy. These projects, however, must incorporate new technologies to address green concerns and be backed by new risk-sharing models, he said. B Anand, former CEO of Nayara Energy and of the TCG Group's petrochemical business, also agrees that the shadow of transition looms over refinery growth. 'Globally, the refining growth story is diminishing. Access to new-age capital for hydrocarbons due to net zero concerns has reduced,' he said. Ashok added that climate efforts are generating competing demand for capital. 'With emphasis on transition and climate impact mitigation efforts, the capital requirements within the organisations are varied and stretched. These are also impacting the view of future refining projects,' said Ashok, who also led the India-Saudi joint venture project, which didn't take off primarily due to land constraints. Anand says India should focus on petrochemicals, as demand is expected to rise with rapid urbanisation and e-commerce. 'For India, building new refineries with so much crude import dependence is not a good idea. We should instead focus on investing in petrochemicals, which has a promising future,' he said.
Time of India
5 days ago
- Business
- Time of India
On slippery ground: Refining capacity rises just 5% in 7 years
India has added just 5% to its refining capacity over the past seven years-a sharp contrast to the 69% expansion originally planned by 2025. A mix of climate-related demand uncertainty , land constraints, and the pandemic has slowed progress, further deepening the country's dependence on energy imports. India's refining capacity was projected to rise from 245 million tonnes per annum (mtpa) in 2017-18 to 414 mtpa by 2025 and 439 mtpa by 2030, according to a 2018 report by an official panel of oil ministry officials and industry executives, which based its projection on "firm plans" by refiners. The refining capacity, however, has risen to just 258 mtpa, according to oil ministry data. The major misses included the India-Saudi 60 mtpa greenfield joint venture project, Rosneft-backed Nayara Energy's 25 mtpa expansion, Reliance Industries' 7.5 mtpa addition, and Indian Oil 's 34 mtpa target. The BPCL-NRL combined capacity expanded by 2 mtpa, compared to a projected 26.4 mtpa by 2025, while the HPCL-ONGC group achieved an 11 mtpa increase-the largest by any group-against its 23 mtpa target. Some expansion projects, including those by Indian Oil and HPCL , are under construction and expected to come online over the next few years. Indian Oil, HPCL, BPCL , RIL , and Nayara declined to comment. Live Events Slower expansion, coupled with surging domestic demand, has pushed up India's imports of petroleum products by 43% in seven years to 2024-25, while exports have declined by 3% in volume terms. B Ashok, former chairman of Indian Oil, says the uncertainty over the impact of energy transition policies, both domestically and globally, has "made decision-makers more circumspect". While acknowledging that refineries are "high capex and high gestation projects", he warned that India needs fast-executed greenfield refinery projects to support its rapidly expanding economy.
Time of India
6 days ago
- Business
- Time of India
As China chokes the tap, Saudi emerges as India's fertiliser ally
India and Saudi Arabia have signed long-term agreements for the supply of diammonium phosphate (DAP) fertiliser, marking a significant development in efforts to enhance the country's fertiliser security. Leading Saudi mining firm Ma'aden has entered into agreements with Indian companies, Indian Potash Ltd (IPL), KRIBHCO, and Coal India Ltd (CIL), for the annual supply of 3.1 million metric tonnes of DAP for five years, with the option to extend the arrangement by another five years with mutual consent. These agreements were signed during Union minister for chemicals and fertilisers J P Nadda's ongoing 'landmark' visit to Saudi Arabia. Indian officials said the deal significantly increases the availability of DAP, the second most used fertiliser in India after urea, and contributes to the country's goal of food security over the medium to long term. India has traditionally depended on countries like China for DAP imports, and the government has been looking to diversify its sourcing to reduce dependency. Without naming China, a government source told ToI that 'at a time when some countries are showing a restrictive approach in fertiliser supply, the commitment from Riyadh demonstrates that India's friends and partners continue to work closely to deliver requirements and collaborate on future investments.' by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Secure Your Child's Future with Strong English Fluency Planet Spark Learn More Undo The visit by Minister Nadda comes just months after Prime Minister Narendra Modi's State Visit to Jeddah in April and has provided fresh momentum to the growing strategic partnership between India and Saudi Arabia. 'Both sides underscored their commitment to broadening the scope of bilateral relations to include other key fertilisers such as urea along with DAP, aiming to ensure India's fertiliser security. Talks were also held on facilitating mutual investments, with a focus on exploring opportunities for Indian PSUs to invest in Saudi fertiliser sector, and reciprocally, Saudi investments in India,' an official said. Live Events The India-Saudi agreement comes at a time when India is facing headwinds in its fertiliser imports from China. According to a report in The Economic Times, China has halted specialty fertiliser exports to India for two months now, forcing Indian companies to turn to Europe, Russia, and West Asia for alternative sources of raw materials — at significantly higher costs. Industry insiders told ET that China had been the preferred source due to higher availability, shorter sailing time, and more affordable prices. 'Imports from China were cheaper, and imports from other countries are at 15–20% higher prices already,' said Yogesh Chandra, vice president at Transworld Furtichem, maker of the Nutrifeed brand of fertilisers. Due to the disruption, around 80,000–100,000 tonnes of raw materials are expected to be imported from alternate sources to make up for the estimated 150,000–160,000 tonnes of speciality fertilisers stuck at Chinese ports. While there is no official export ban in place, Chinese authorities have stopped inspecting consignments bound for India — a mandatory step for export clearance — effectively halting shipments. Meanwhile, China continues to export these fertilisers to other countries. India depends on China for around 80% of its specialty fertiliser imports. The alternative imports are not only more expensive due to limited availability but also burdened by higher shipping costs. Industry players expect prices to rise further, particularly for key nutrients like mono ammonium phosphate (MAP) and calcium nitrate (CN). 'The prices are going to go higher as Russia also has a limited supply,' said Sanket Pawar of Aries Agro, a manufacturer of micronutrients. As MAP supply from Russia remains tight, companies are exploring imports from Morocco. While Israel is another potential supplier, many importers are currently avoiding it due to the ongoing conflict in West Asia, insiders told ET. The tightening fertiliser trade also reflects a larger pattern in China's export behaviour. Beijing has been selectively restricting exports of critical materials, such as rare earth magnets, where it controls about 90% of global output, in apparent response to US tariffs and curbs. India, for its part, has imposed restrictions on Chinese firms' access to its domestic markets and now requires prior government approval for investments from countries with which it shares a land border. The result has been escalating friction in critical sectors, including fertilisers.
The Hindu
6 days ago
- Business
- The Hindu
Indian fertilizer majors sign deal with Saudi Arabia firm Ma'aden
NEW DELHI Three major fertilizer producers from India entered into long-term agreements on supply of fertilizers with Ma'aden of Saudi Arabia. The signing of the agreements was done in the presence of J. P. Nadda, Minister of Health and Family Welfare and Chemicals and Fertilizers, who is on a three-day (July 11-13) visit to the Gulf kingdom. A press note from the Government of India said that the agreements will ensure the supply of 3.1 million MT of DAP (Diammonium Phosphate) fertilizer per annum for five years from 2025-26 onwards, with further extension of five years with 'mutual consent'. Also read: Coromandel International signs MoU with Saudi miner Ma'aden for phosphatic fertilizers Mr. Nadda met with the Saudi Minister of Industry and Mineral Resources, Bandar bin Ibrahim Al Khorayef, in capital Riyadh and discussed mechanisms to strengthen bilateral partnership on fertilizers, petrochemicals and pharmaceutical sectors. 'Discussions were also held on facilitating mutual investments, with a focus on exploring opportunities for Indian Public Sector Undertakings (PSUs) to invest in the Saudi fertilizer sector, and reciprocally, Saudi investments in India,' said the press note. The two sides also formed a joint team led by the Secretary (Fertilizer) on the Indian side and the Vice Minister for Mining Affairs in the Ministry of Industry and Mineral Resources on the Saudi side to explore long-term collaboration in this sector — a step crucial for ensuring India's agricultural security. 'At a time when some countries are showing a restrictive approach in fertilizer supply, the commitment from KSA demonstrates that India's friends and partners continue to work closely to deliver requirements and collaborate on future investments,' said the press note. Mr. Nadda also met Prince Abdulaziz bin Salman Al Saud, Minister of Energy, and co-chair of the Economy and Investment Committee of the Strategic Partnership Council between India and Saudi Arabia, on ways to enhance the economic partnership between the two countries. The second meeting of the Strategic Partnership Council (SPC) took place during Prime Minister Narendra Modi's visit to Jeddah in April. The SPC has prioritised India-Saudi relations in the fields of defence, energy and cultural domains.
