Veteran Oil & Gas experts say that in this business it’s important to know when to walk away. Media is agog with news of US Tariffs and India’s persistence in buying Russian Crude. Almost all media houses are suddenly reporting incessantly on this business sector.
Quickly, everyone seems to have woken up to the vital importance of Oil & Gas. Many citizens may have noticed that the voice of India policy makers, think tanks, a significant body set up by the cabinet, who is in advisory & planning role to the government, know alls; who otherwise wax eloquent on Indian Economy & Business, suddenly become inversely proportional in pitch, to the stridency of the media. No addressing the nation, award giving ceremonies, holding seminars, dishing out gyan, No, they know, this is not the time for all that. There is a nice couplet suited to the occasion -
(Siyasat me zaruri hai rabadari samajta hai,Roza to nahi rakhta iftaari samajta hai,सियासत में ज़रूरी है रबादारी समझता है , रोज़ा तो नहीं रखता इफ़्तारी समझता है )
Its left to the already heavily burdened PM to hold the fort and keep the nation’s morale high. Well many quip that limited knowledge and knowhow will take you only up to a point no further. India has its list of marquees and so does US.
In the big, bad world of international business, boys need to grow up to be men fast, else a nation pays. Look at the position of China vis a vis India. Most marvel the way they have strategically positioned themselves. They are the leading buyers of Russian crude but are in a much favorable position compared to India. Be it imposition of tariffs, de freezing of their Apps, supply of chips even student Visas China is winning its battles silently but surely.
India, the Viswaguru continues to sermonize. But in realpolitik business world, all know, who holds the aces. It’s said that in politics and diplomacy there are no permanent friends. But it’s equally true that most calculate the worth of a person before making friends. Today India finds itself in a peculiar position.
And undoubtedly bureaucrats have no suggestions or answers, only reflexive actions which they hesitantly put forth as a beleaguered nation looks up to them.
NewsIP has been trying to bring to its readers many aspect of Oil & Gas business. The current imbroglio acquires a hug huge significance for the common man. One has to understand why this brouhaha about Tariffs being imposed by USA due to purchase of Russian Crude ostensively to stop the Ukraine war.
A relevant question which many tend to fend off is who pays the tariffs? In a recent Senate Committee meeting held in USA, the Secretary had initially not answered directly and said it’s a complicated question. But the congressman, who had asked the question pressed very hard and later himself answered that Consumers pay the tariff tax.
This is in a way true for India as well, the 50% tariff has become applicable from 27.08.2025 and its impact on citizens – common people, farmers, corporate etc. is yet to pan out fully. Already, the impacted corporate sectors, mostly export oriented, are shouting the most for Government assistance/ subsidy. Sounds familiar? Many moons ago, such demands of PSUs, were put down forcefully.
One can understand the doles held out to farmers but Private Corporates? Pray why for them? They always were for no government interference and market driven business. Many would say it’s another business eventuality they need to face. Its common knowledge that Government has to keep the Oil & Gas prices down as these are essential commodities of which the Private Corporates are also consumers! Therefore, does it make sense to subsidize Diamonds, Gems & Jewelry, Software (where companies regularly sack employees), Premium Leather etc. ?
Economists also differ on the reason why US has weaponized Tariffs? Many feel it’s not to stop the war but essentially to protect US business interests. Well if this opinion was to be true, what do our own government advisors have to say? They may also retort that it’s a complicated question! A follow up question which many Indian citizens would like answered is- With the Cease Fire/ Peace Process in advanced stage; after peace is achieved between Russia and Ukraine, will USA remove these Tariffs imposed on India? What if these Tariffs become the new norm? US is already warming up to China and Pakistan.
The swiftness with which US has smoked the peace pipe with both these nations has made India red faced. India seems have suddenly shifted from a position of a favored nation to that of a demonstrable punching bag. US seems to be holding out a message for all nations – fall in line or else we may Indianise you! Neighboring nations are all watching India. The geopolitical tectonic plates are shifting and shifting fast.
To top it all, India seems to be lacking that one internal fulcrum which other Asian countries have been able to revolve around. Some Asian nations lean on ulta religious platforms while others on nationalism but India seems to have its feet on several boats.
Coming back to the Oil & Gas sector many veterans say that the US Tariffs are not impacting PSUs as much as its impacting the Private players. They are gradually realizing that the low hanging fruits of windfall profits may have several thorns.
That has disgusted them. Everything was hunky dory, they were managing to ride on the crest of rights devolving to Indian Refiners & Marketers, which the government had as a sovereign entity, so magnanimously obtained from Russia. The Covid and post Covid era were bountiful and profits became glaring and garishly apparent. So much so that Indian government had to impose, for the first time, windfall taxes.
The veterans state – Well a bit of a challenge of falling GRMs & Marketing Margins and the same private companies cannot tolerate it and come running to the government which they so disdainfully wanted out of the Oil & Gas business. How ironical.
The Oil & Gas PSUs not being merely guided by lucre are on a firmer footing. However, they will also require some miniscule support from the government and the large heartedness of the nation as a whole.
NewsIP is confident that the Oil & Gas sector will come out of the current challenges a winner. And as Winston Churchill had said – If you’re going through hell, keep going.
