The paradox of plenty: India’s refining ambition and the net-zero tightrope
Editor Manoj Sharma editor@refiningindia.com +91 989 9077 595 Managing Editor Rachel Storry
rachel.storry@emap.com tel +44 (0)7786 136440 Editorial Assistant Lisa Harrison lisa.harrison@emap.com Graphics Peter Harper Business Development Director Paul Mason info@decarbonisationtechnology.com
India, a rapidly developing economy with an insatiable appetite for energy, finds itself on a fascinating and challenging tightrope walk. On one side, the nation is aggressively pursuing a net-zero emissions target by 2070, a critical commitment in the global fight against climate change.
On the other, it continues to eye significant expansions in its oil refining capacity, seemingly locking in a fossil fuel-dependent future. This apparent paradox, however, is a nuanced reflection of India’s unique developmental trajectory and its pragmatic approach to energy security and economic growth. The primary economic driver for expanding refining capacity is to meet India’s burgeoning domestic fuel demand. Domestic consumption of petroleum products has grown at a compound annual growth rate (CAGR) of 4% over the last decade. India’s existing refining capacity is currently operating at optimal levels, with utilisation rates of 100-103%. The government maintains that refining capacity must keep pace with this escalating demand to prevent an excessive reliance on fuel imports, which could expose the nation to global price shocks and supply vulnerabilities. However, the current data show a refining capacity of only 258 MMTPA. This situation reveals the core of the paradox: India’s energy demand is projected to grow more than that of any other country in the coming decades. With a large population still experiencing energy poverty and a rapidly expanding industrial and transportation sector, the immediate need for conventional fuels remains undeniable. To simply halt or significantly curb refining expansion would be to compromise energy security, invite import dependence, and potentially stifle economic growth – a gamble no developing nation can afford. The Indian government has set targets for refining capacity, aiming to reach 310 MMTPA by fiscal year 2030. Long-term forecasts from organisations like OPEC project India’s oil demand to more than double from 2024 levels, reaching 13.7 million barrels per day (mn b/d) by 2050, making it the single largest contributor to global oil demand growth. This necessitates significant, sustained investment in refining infrastructure.
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Cover Story India harbours ambitions of becoming a major refining hub in Asia.
Refining India
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