The government has cut the tariff on all crude oil and petroleum imports from Brunei, a member of the Association of South East Asian Nations (Asean) grouping.
Against the earlier ad valorem duty of three per cent and a customs duty of two per cent, the latter has been removed entirely. However, our oil imports from Brunei are very little.
Official sources said the commerce ministry would consider such rationalistion of duty on crude oil imports from any other country if there was a proper representation. Major oil importing sources for India are Saudi Arabia, Russia, the US, Iran, Iraq and the Emirates.
The readiness to consider more duty relaxation arises from the growing oil demand, for both consumption and refining, sources said. Imports during September were valued at $7,490 million, 14.4 per cent higher than the $ 6,546 million of imports in the corresponding period last year.
Oil imports during April-September were $48,715 million, as much as 30 per cent higher than those of $37,475 million in the same poeriod last year.
Officials said a duty relaxation for other Asean countries stood a better chance, due to the Preferential Trade Agreement signed last year between this country and the Asean ones.
The government aims to promote India as a competitive oil refining destination and industry experts expect the country to be an exporter of refined products to Asia in the near future. India has 2.8 million bbl/d (barrels per day) of refining capacity, at 18 facilities. This is the fifth largest refinery capacity in the world. Privately-owned Reliance Industries, at 1.24 million bbl/d, has the largest oil refinery complex in the world.
Other key upcoming refinery projects include Essar Oil’s Vadinar refinery expansion of 110,000 bbl/d in 2011, a new 20,000 bbl/d refinery in Bina in 2011 by a joint venture between Bharat Petroleum Corporation and Oman Oil Company Ltd, a 180,000 bbl/d refinery in Bhatinda in 2014 by Hindustan Petroleum Corporation and IOC’s Paradeep refinery of 300,000 bbl/d in 2015. India is slated to add 840,000 bbl/d of refining capacity through 2015 based on currently proposed projects.
