India diversifies fuel imports, turns to China

India has perhaps for the first time imported petrol and diesel from China as the world's third largest oil consumer looks at diversifying its sources of fuel.

India imported 18,000 tonnes of petrol and 39,000 tonnes of diesel in the first nine months of the current fiscal, Oil Minister Dharmendra Pradhan said in a written reply to a question in the Rajya Sabha.

Traditionally, Singapore and the UAE have been its biggest sources of petrol and diesel.

"Although overall production of petrol and diesel is in excess of domestic consumption, due to specific product requirements, some quantity of petrol and diesel are imported," he said.

Pradhan said India had not imported any petrol or diesel from China in the last four years.

During April-December 2016, India produced 27.1 million tonnes of petrol against a consumption of 17.96 million tonnes. In the case of diesel, the production stood at 76.55 million tonnes in comparison to 57.24 million tonnes.

India imported 8,20,000 tonnes of diesel and 4,76,000 tonnes of petrol in April-December, he said.

Also, there are refineries like the only-for-exports unit of Reliance Industries at Jamnagar in Gujarat, that sell most of their fuel only in overseas markets.

Pradhan said in the first nine months of the current fiscal, the UAE toppled Singapore to become the India's biggest supplier of petrol at 2,43,000 tonnes. Singapore supplied 1,69,000 tonnes of petrol.

The UEA was also the top supplier of diesel at 3,80,000 tonnes.

In 2015-16 full fiscal, Singapore had supplied 6,41,000 tonnes of petrol while the UAE had sold 1,83,000 tonnes of petrol and 1,22,000 tonnes of diesel.

"In order to improve the domestic production of petrol and diesel, refineries are implementing refinery process improvement projects," he added.

India has the capacity to refine crude oil and produce fuel in excess of its demand against an installed refining capacity of 230.1 million tonnes, while the total fuel demand in 2015-16 was 184.7 million tonnes.

In the April-January period of 2016-17, the fuel demand stood at 161.4 million tonnes as compared to refineries producing 202 million tonnes of fuel.

However, India is 80 per cent dependent on imports to meet its raw material, crude oil needs. Its domestic production was under 37 million tonnes in 2015-16 and 30.1 million tonnes in April-January 2016-17. 

Photograph: Reuters.