India’s Dependence on the Middle East for Oil: Has India found an alternative and what are the options?
Multiple studies indicate that India’s oil needs will be more than any other country by 2040
Domestic prices of petrol and diesel in India are linked to global fluctuations. 60% of India’s crude oil requirement is fulfilled by Iraq, Iran and Saudi Arabia
Aggressive purchase of foreign currency for importing oil leads to devaluation of rupee and ultimately affecting India’s purchasing power
It will have a cascading effect like depreciation of rupee and will see a big rise in commodity prices leading to inflation.
This is where the importance of domestic production, strengthening of indigenous industries and import substitution comes into picture.
Alternative energy sources like natural gas and solar power is one way to reduce dependence on imported crude oil.