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India’s Energy Sector Transformation

 

1. Detailed Concept

India has become the world’s 4th largest economy, overtaking Japan in 2025 with a GDP of $4.3 trillion, reflecting a decade of economic strategy under PM Modi marked by:

The energy sector—a critical pillar of India’s growth—has undergone structural transformation, focused on energy security = development security.

 

2. Data & Facts

Metric

2014

2025

GDP (Nominal, USD)

~$2 trillion

$4.3 trillion

Ethanol blending in petrol

1.5%

19.7%

City Gas Distribution Areas

55

307

Piped Natural Gas (PNG) connections

25 lakh

1.5 crore

CNG Stations

~1,000

7,500+

Crude Oil Exploration Acreage

8%

16%

Natural Gas Production

28.7 BCM (2020–21)

36.4 BCM (2023–24)

Product Pipelines

—

24,000 km

Retail Outlets

—

~96,000

National Gas Grid

—

25,000 km → Target: 33,000 km (by 2030)

Ethanol Production

38 crore litres

484 crore litres

Emission Reduction via Ethanol

—

643 lakh MT

Foreign Exchange Saved

—

₹1.26 lakh crore

 

 

3. Comparison & Analysis (CA)

India vs Global Peers – Energy Metrics

Parameter

India

Global Rank

Oil Consumer

3rd largest

 

Oil Refiner

4th largest

 

LNG Importer

4th largest

 

Fastest GDP Growth (2025 Q1)

6.7%

#1 among major economies

 

Energy Trilemma: India’s Four-Pronged Strategy

Pillar

Action Taken

1. Diversification

More global suppliers, Indo-Nepal pipeline

2. Domestic Production

Expanded acreage, new exploration basins

3. Renewables Push

Green hydrogen, ethanol, biogas

4. Affordability

Targeted subsidies (Ujjwala Yojana), excise duty cuts

 

 

4. UPSC Prelims Trap Table

Statement

True/False

Explanation

India is the largest oil consumer globally.

❌ False

3rd largest

India’s exploration acreage has halved since 2021.

❌ False

It doubled from 8% to 16%

The SATAT initiative promotes green hydrogen.

❌ False

SATAT is for Compressed Biogas (CBG)

PMUY beneficiaries pay full market price for LPG.

❌ False

Subsidized: ₹553 per cylinder

Green hydrogen blending has already started in India.

✅ Partially true

Large-scale production & tenders underway

 

 

5. Related Current Affairs

  • India overtakes Japan to become 4th largest economy.

  • Energy Security as Development Security: growing LNG, oil imports & domestic exploration.

  • Oilfields Act Amendment 2024: Hybrid leases for hydrocarbons + renewables.

  • Green Hydrogen Mission: 8.62 lakh tonnes production capacity & 3,000 MW electrolyser tenders.

  • SATAT Initiative: 100+ CBG plants; 5% blending target by 2028.

  • Digital Mapping: PM Gati Shakti, over 1 lakh petroleum assets mapped.

 

6. Related Yojana/Schemes/Acts

Scheme/Policy

Objective

Open Acreage Licensing Policy (OALP)

Flexibility for investors to select blocks

Pradhan Mantri Ujjwala Yojana (PMUY)

Subsidized LPG for rural women

SATAT

Promote compressed biogas (CBG)

Oilfields (Regulation & Development) Amendment Act 2024

Hybrid leases for renewables + hydrocarbons

Green Hydrogen Mission

Promote clean hydrogen production

PM Gati Shakti

Real-time infra mapping, cross-ministerial coordination

 

 

7. Linked Topics & Subjects

  • GS3 – Indian Economy: GDP growth, reforms, sectoral shifts

  • GS3 – Energy & Infrastructure: Energy trilemma, domestic production, renewables

  • GS2 – Governance: Policy reforms, centre-state energy cooperation

  • Essay: “Self-reliance in energy: India’s road to economic sovereignty”

  • Ethics: Sustainable development vs economic ambition

 

8. Prelims PYQs & MCQs

MCQ:

Q: Which of the following is/are part of India’s strategy to address the energy trilemma?

  1. Diversification of suppliers

  2. Focus on biofuels

  3. Transition to coal-dominated energy mix

  4. Use of unified pipeline tariffs

a) 1, 2 and 4 only

b) 1 and 3 only

c) 2, 3 and 4 only

d) 1, 2, 3 and 4

✅ Answer: a)

 

9. Mains PYQs & Practice Questions

GS3 Mains (Expected 2025):

India’s energy sector has evolved from anxiety to assurance. Examine the strategic interventions made in the last decade to transform India into an energy-secure and self-reliant nation.

GS2 Governance Mains Q:

Discuss the role of policy and digital governance in India’s energy sector reforms, with reference to PM Gati Shakti and Open Acreage Licensing.

Essay Topic Suggestion:

“Energy is the new currency of power: India’s journey to become a self-reliant economy.”

 

Conclusion Points for Mains

  • India’s energy journey is a story of strategic pivot, digital reform, and global cooperation.

  • Through investments in biofuels, hydrogen, domestic production, and consumer affordability, India is setting a model for sustainable growth.

  • The vision is not just energy access, but energy sovereignty—fueling economic independence, climate action, and strategic influence.

 



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