Government’s thought process is simple: If India is focusing on electric vehicles, then the present focus on petroleum conservation needs to shift; Petroleum Conservation Research Association may cease to exist.

New Delhi: In a silent move, the government has decided to consider putting down the shutters on Petroleum Conservation Research Association.
The thought process of the government is simple. If India is increasingly focusing on electric vehicles (read clean energy), then the present focus on petroleum conservation needs to shift.
Top officials of PCRA, it is reliably learnt, have been told by some in the government that the organization would cease to exist by September, 2022, which means in just two months’time.
The move comes more than four-and-a-half decades after the then petroleum and natural gas minister Morarji Desai—who held the post besides being the Prime Minister—pushed for a state-owned body which should be funded by state-owned oil and gas companies and work actively for petroleum conservation.
PCRA was formed under the Ministry of Petroleum and Natural Gas.
The move to look to disbanding the body has, expectedly, met with resistance from officials of PCRA, some have gone to court to seek redressal. Repeated attempts to seek reactions from the employees who went to court proved futile. An email sent to Asheesh Joshi, a senior IAS officer and executive director, PCRA, remained unanswered.
PCRA, funded by state-owned oil and gas companies and energy companies, was engaged in promoting energy efficiency in various sectors of the economy. Its job was to help the government (read the ministry of Petroleum and Natural Gas) shape policies and strategies aimed at reducing India’s dependency on oil, reducing environmental impact of oil use and conserving fossil fuel.
India’s demand for petroleum products is increasing at a rate of approximately 3-4% per annum.
At the heart of the government’s move lies India’s big race to seek clean energy. Interestingly, a PCRA study some years ago said fuel worth Rs. 994 cr per annum is being burnt at traffic signals due to idling of vehicles at red lights. The study further said if India reduces its use of petroleum products by 2% per year—Rs 400,000 crores—New Delhi could save Rs. 8,000 Crores worth of imports.
So, the need of the hour is to move away—slowly but steadily—from petroleum and petroleum products. The PMO is trying hard to do exactly that, claim those in the know. Experts say it is high time India makes a serious transition towards cleaner technology, especially in the light of higher oil taxes and investment in EV vehicles.
And then there are the issues of increasing lifestyle standards and increased risk of infection transmission. Encouraged by the banking sector’s capacity to provide affordable financing options for automobiles, India became the fifth-largest automobile market in the world in 2020.
Around 3.5 million units of commercial and passenger vehicles were sold in the country. And these vehicles continued to consume a fair share of oil and pollute air in their life cycles.
India’s oil consumption was reported at 4,669.078 barrels per day in December 2020, nearly 90% of demand was fulfilled through imports. The government realizes that this, in turn, puts a heavy burden on India’s mobility ambitions. Petroleum prices in India currently hover around the Rs 100 per litre, making mobility dearer. Significant portion of petrol prices are from heavy taxes levied by state and central governments.
High taxes on consumer petroleum products create the perfect condition for battery electric vehicles (BEV) and hybrid vehicles (referred to as EVs henceforth) push in India. The basic idea is to cut carbon emissions from the transportation sector.
India’s 2030 EV vision includes replacing 30% private cars, 70% commercial vehicles, 40 per cent buses and 80 per cent two-wheelers. This amounts to introducing 102 million units of EVs on India’s roads. The EV sector is already getting great incubation support through subsidies.
The EV market in India is estimated to touch Rs 30,416 crore in 2025. By the end of July, 2021, India received more than Rs 25,000 crore worth investment for the EV sector. In the first quarter of 2021, India’s total foreign direct investment was around Rs 1,71,321 crore.
India could get an investment of Rs 95,812 crore in the next five years, according to the report Electric Mobility in Full Gear 2021, India.
And then there is the issue of job creation. Apart from the capital gain, the EV sector will create around 10 million jobs in India by 2030 in domains such as designing, testing, manufacturing, charging infrastructure, sales, battery technology, management, among others.