Being Petroleum-Independent

Context: India should reduce its energy import dependence to tackle rising fuel prices.

Steps taken for managing the demand for petroleum products

• Formulation of fuel efficiency standards: Subjected heavy-duty vehicles to fuel efficiency standards.
  • However, India’s 2022 fuel efficiency standards for passenger cars are nearly 20% less stringent than the European Union’s standards.
• Constituted the National Electric Mobility Mission Plan (NEMMP): However, the focus is more on hybrids rather than electric vehicles. 
• Increase energy security:
  • Bioethanol mixing in petrol: to nearly 8% by volume under the 2018 National Policy on Biofuels. 
  • Encouraged multiple fuel pathways in the transport sector.
  • Steps towards transition to electric vehicles: 
    • Faster Adoption and Manufacturing of Electric Vehicles (FAME-II) scheme focusing largely on electric vehicles.
    • Fiscal and non-fiscal incentives to encourage a transition to electric vehicles.

More steps required to reduce dependence on petroleum

• Formulate a zero-emissions vehicle (ZEV) programme:  That mandates vehicle manufacturers to produce a certain number of electric vehicles. (like in China and the United States)
• Strengthen fuel efficiency requirements: for new passenger cars and commercial vehicles and formulate fuel efficiency standards for two-wheelers.
• Complementary policies:
  • Extend the FAME scheme: to all passenger cars, commercial vehicles and agricultural tractor.
  • Extend fiscal incentives to all kinds of vehicles.
  • Stepping up investments in charging infrastructure.
  • Tax vehicles based on fuel efficiency rather than based on vehicle length and engine size.

Conclusion: Government should enhance long-term energy security by wielding the regulatory tools at its disposal.