Abstract: With rapid economic growth, energy demand in India has been rising rapidly, and India is now the fourth largest consumer of crude oil in the world. Unfortunately, India has to import most of its oil requirement, which leads to severe pressure on the economy when the oil prices rise. Thus, estimations of crude oil demand and projections for the future should be useful to policy makers in making appropriate supply arrangements for the future.
In this paper empirically estimates falling of crude prices and position of India’s oil industry. We analyze the relationship trend of production over its consumption and production with import. Then crude prices effect on India’s inflation, its importance to Reserve Bank of India, its impact on fiscal and tread deficit and Indian oil companies. Finally by considering all these effect and impacts we figure out future hold for India considering crude prices.
Therefore, India should take various measures to improve efficiency in the use of petroleum products and try to enhance supplies such as through production sharing agreements by Indian oil companies with other countries. We also need to increase use of nuclear, hydro, solar, and other alternative energy sources, as Western European countries have been doing. Careful planning to ensure that future petroleum requirements can be met will be useful in sustaining rapid economic growth in the future.
Keywords: Fiscal Deficit, Inflation, OPEC, PPAC, RBI, Trade Deficit.
Title: Crude Oil Prices and Its Impact on Indian Economy
Author: Akansha Sanjay Jain, Nitish Sunil Patil
International Journal of Social Science and Humanities Research
ISSN 2348-3156 (Print), ISSN 2348-3164 (online)
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