India has seen an increase of over 88 per cent in dependence on imported crude oil to meet its domestic consumption needs in the first four months of the current financial year.
India’s dependence on oil imports rose to 88.3 per cent during April-July as a result of increased demand for fuel and other petroleum products, up from 87.8 per cent in the year-ago period with the full financial year 2023-24 (FY24).
According to the latest data from the Ministry of Petroleum Planning and Analysis Cell (PPAC), the country’s dependence on oil imports in FY24 was 87.8 per cent, 87.4 per cent in FY23, 85.5 per cent in FY22, 84.4 per cent in FY21, 85 per cent in FY20 and 83.8 per cent in FY19.
Over-reliance on imported crude oil puts the Indian economy in a vulnerable situation and it faces fluctuations in global oil prices, besides impacting the country’s trade deficit, foreign exchange reserves, rupee exchange rate and inflation.
Dependence on crude oil imports has increased due to inadequate domestic production although its demand has steadily increased over time.
In 2015, the government had set a target to reduce dependence on oil imports from 77 per cent in 2013-14 to 67 per cent by 2022. However, the dependency has only increased since then, the Indian Express reported.