The Union government is exploring “all viable options” to procure crude oil at affordable rates, the finance ministry said on April 7.

“In the spirit of Atmanirbhar Bharat, that places national economic and security interests above any other consideration, Government is exploring all viable options, including import diversification, to procure crude at an affordable price,” the finance ministry wrote in its Monthly Economic Review report for March.

“Affordability is desired as even the present level of international crude price, should it persist for a long time, may come in the way of India achieving a real economic growth rate north of 8 percent in FY23,” the report added.

Finance Minister Nirmala Sitharaman made similar comments at the 17th edition of the CNBC-TV18 India Business Leaders Awards on April 1, saying that if fuel was available at a discount, India would buy it.

However, the finance ministry’s review report painted a rather dire picture, saying the rise in imports in March because of a 20 percent month-on-month increase in crude oil prices “does not portend well for the economy in the year ahead”.

While India’s merchandise imports crossed the $40-billion mark for the first time in March, as per preliminary data, imports amounted to a massive $59.1 billion last month.

India’s total merchandise import bill for FY22 was $610.2 billion.

“To ensure security of crude supplies and to mitigate the risk of dependence on crude oil from single region, India has been focusing on diversifying its petroleum basket across various geographical locations viz. Middle East, Africa, North America, South America etc,” the finance ministry said in the report, adding that cheaper crude oil from Russia and energy sources beyond traditional hydrocarbons were part of the strategy to mitigate the adverse effects of high prices.

India’s procurement of discounted crude oil from Russia has drawn criticism from the US. According to reports, President Joe Biden’s administration has been left disappointed by some of India’s reaction to Russia’s invasion of Ukraine and has warned it against aligning itself with Russia.

“There are certainly areas where we have been disappointed by both China and India’s decisions, in the context of the invasion,” Bloomberg reported on April 7, quoting Brian Deese, the director of the White House National Economic Council.
Deese’s comments come after White House Press Secretary Jen Psaki said on April 5 it was not in India’s interests to increase its energy imports from Russia.
Source: PTI