9NOVEMBER 2024OIL SUBSIDIES REFORMED TO PAVE THE WAY FOR RENEWABLE ENERGY INVESTMENTSINDIA BECOMES WORLD'S SECOND-LARGEST PETROLEUM EXPORTER IN 2023India has made significant strides in reforming fossil fuel subsidies, reducing support for the oil and gas sector by 85 percent, from $25 billion in 2013 to $3.5 billion in 2023, according to a statement from the Ministry of New and Renewable Energy (MNRE). Following a "remove, target, and shift" strategy, India has steadily cut down on subsidies since 2010 by adjusting retail prices, tax rates, and subsidies for specific petroleum products. This transformation has freed up fiscal resources, allowing the government to invest in renewable energy and sustainable infrastructure.Key reforms included the phasing out of petrol and diesel subsidies from 2010 to 2014, followed by tax hikes on these fuels until 2017 during periods of lower global oil prices. These tax revenues were strategically redirected to fund liquefied petroleum gas (LPG) subsidies for rural communities, aiming to support environmental and social welfare objectives.With these subsidy cuts, India has increasingly directed funds towards clean energy projects, including solar parks, distributed energy solutions, and the expansion of electric vehicle infrastructure. The MNRE emphasized that India's approach serves as a model for other countries seeking to reduce dependency on fossil fuels, pointing to an ongoing investment in clean energy solutions and grid-strengthening initiatives. The gradual subsidy reduction has laid the groundwork for an accelerated transition toward renewable energy, with fiscal room now available to support large-scale, sustainable projects. The nation's portion of worldwide deliveries in the precious and semi-precious stones category increased to 36.53 percent in the previous year from 16.27 percent in 2018. Exports rose from $0.26 billion in 2018 to $1.52 billion in 2023, propelling the country to the top position in the category. In 2018, it held the second position.According to data from the commerce ministry, India has seen strong growth in several sectors like petroleum, gemstones, agrochemicals, and sugar, increasing their global trade share in the past five years.During the years 2018 to 2023, India's exports have seen a rise in the sectors of electrical goods, pneumatic tyres, taps and valves, and semiconductor devices. Likewise, exports of cane or beet sugar from the country have increased fourfold to $3.72 billion from $0.93 billion in 2018.India's export of cane or beet sugar has seen significant growth, with its worldwide market presence rising from 4.17 percent in 2018 to 12.21 percent in 2023."As the world's second-largest exporter of sugar, India's success can be attributed to both favourable agricultural policies and its strong production base. The country has capitalised on the growing global demand for sugar, especially in regions like Southeast Asia and Africa," an official said. The ministry's data analysis indicated that petroleum exports increased to $84.96 billion in 2023, with India's market share rising to 12.59 percent last year from 6.45 percent in 2018, making it the second-largest global exporter.
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