Narendra Modi’s win in India’s recent general polls is expected to see some major reforms in the oil and gas sector. His win could end the extended period of under-investment oil & gas industry has been going through in the country. The humongous victory of Bhartiya Janta Party led elections to form a stable government in India is expected to address some of India’s crucial economic challenges.
In the past, low gas prices have been a great barrier for offshore exploration opportunities and more -over lot of foreign investors also exited due to India’s regulatory hurdles.
According to the analysts, the new government is likely to increase the prices of natural gas which would promote foreign investment in oil and gas sector. It will consequently control diesel prices which will cut government’s subsidy prices. In a recent report by Credit Suisse, the oil and gas sector in India will see reforms and many measures will be taken by the government and implemented in oil and gas sector.
Analysts say that after a long period of stall in energy reforms, Modi Government will finally bring oil and gas reforms in India. This implementation will carry forward previous government’s policy of decreasing oil prices and bringing number policies which will consequently promote investments in energy sector.
In the last couple of years, India has been facing increased import costs and deteriorating output. In the past, government had no option but to raise oil and gas prices. With the new government forming in and Modi taking oath as the Prime Minister of India, oil and gas companies are seeing a positive sign.