Old Jewels in New Boxes? India’s Major Public Sector Petroleum and Natural Gas Exploration and Production Enterprises

Abstract

State-owned petroleum and natural gas companies are quite prevalent in many emerging economies. Besides companies in China and India, Petronas of Malaysia and Petrobras of Brazil are prominent examples. These companies are often large and dominate the economic landscape, not just within their national economies but also in the international arena. This chapter deals with the major Indian public sector petroleum and natural gas exploration and production (E&P) enterprises, namely, the Oil and Natural Gas Corporation Limited (ONGC) and Oil India Limited (OIL). The objective is to analyse the nature of these enterprises with particular reference to their position in the domestic political economy, the extent and characteristics of their relationship with the government, the impact of the domestic economy on the companies’ profitability and viability and the future prospects of these companies. As far as possible, no attempt is made to impose a normative structure on the analysis. Rather, the companies are analysed in light of their evolution within a changing global and domestic socio-political and economic milieu. Therefore, issues such as the desirability or otherwise of privatisation or disinvestments are not the primary concern of this chapter. Rather, the attempt is to hold up a mirror to past and present structures and systems surrounding these entities.