GS Paper I- History and Geography of the World and Society.
Iraq Overtakes Saudi Arabia As India’s Biggest Oil Su
- Iraq has overtaken Saudi Arabia by a wide margin to become India’s top crude oil supplier, meeting more than a fifth of the country’s oil needs in the current financial year.
- Saudi Arabia traditionally has been India’s top oil source but in the April-January period of 2017-18, Iraq dethroned it, supplying 38.9 million tonnes (MT) of oil, oil minister Dharmendra Pradhan said on 5th March, 2018.
- In a written reply to a question in the Lok Sabha, he said Saudi Arabia supplied 30.9 MT of crude oil in the first 10 months of the current fiscal.
Highlights Of The Development-
- India imported 184.4 MT of crude oil during the period as compared to 213.9 MT in the entire 2016-17 fiscal, and 202.8 MT in 2015-16.
- Despite India cutting imports over delays in award of contract for a gas field development, Iran continued to be the third largest supplier selling 18.4 MT during April-January.
- This is the second year in a row that Iran has occupied the third position. Iran was India’s second biggest supplier of crude oil after Saudi Arabia till 2010-11 but western sanctions over its suspected nuclear programme relegated it to the 7th spot in the subsequent years.
- In 2013-14 and 2014-15, India bought 11 MT and 10.95 MT respectively from it. Sourcing from Iran increased to 12.7 MT in 2015-16, giving it the sixth spot.
- In the following year, the Iranian supplies jumped to 27.2 MT to catapult it to the third spot, Pradhan said.
- Venezuela is India’s fourth largest supplier with 15.5 MT during April-January, followed by Nigeria with 14.9 MT, he said. India is 80 per cent dependent on imports to meet its oil needs.
- Easing of western sanctions in 2015 has led to the Indian refiners raising their purchase from Iran. Kuwait, which was the third largest supplier in 2013-14, has steadily slipped, supplying just 10.2 MT in the first 10 months of the current fiscal. It had in 2014-15 supplied 17.9 MT crude, which came down to 11 MT in 2015-16 and 9.8 MT in 2016-17, Pradhan said.
- India’s dependence on the Middle East for its crude oil needs has increased from 58% in 2014-15 to 63.7% in the April-January period of this fiscal, he said.
- India had imported 109.9 MT out of 189.4 MT of total crude imports in 2014-15 from the region. In the current fiscal so far, the Middle East has accounted for 117.5 MT of crude oil supplies from India.
GS Paper II- International Relations.
India Starts Importing LNG From US For The First Time.
- India’s relationship with the US as a major consumer of the oil and gas produced in the latter, advanced a step further on 6th March, 2018 with the first shipment of US-produced gas bound for India flagged off from Louisiana.
- The shipment is being sent under a twenty-year agreement between Indian gas utility major GAIL India and US-based Cheniere Energy’s Sabine Pass liquefaction facility in Louisiana.
- The cargo has been loaded on-board GAIL’s first chartered liquefied natural gas (LNG) ship ‘Meridian Spirit’. This LNG cargo originated from Cheniere Energy’s LNG export facility at Sabine Pass LNG project, GAIL said, adding that the cargo will discharge LNG at GAIL’s Dabhol terminal on or around March 28.
Highlights Of The Development-
- GAIL had signed the initial sale and purchase agreement (SPA) with Cheniere Energy in December 2011. That SPA went into effect from March 1, 2018, and under the contract, GAIL will receive 3.5 million tonnes per annum of LNG from the US-based LNG exporter.
- The development comes on the heels of India’s first import of crude oil from the US in October, last year (2017). India has been diversifying its oil basket over the last few months in an effort to keep the oil and gas prices import bill down.
- While the US had stopped oil exports in 1975, a ban that was only lifted by former US President Barack Obama in 2015, the country has rapidly become an oil sector powerhouse.
- According to the International Energy Agency’s latest report, production increases in the US are expected to take care of 80 per cent of global demand growth in the next three years.With supplies commencing from the US, GAIL will have a diversified portfolio both on price indexation and geographical locations, GAIL CMD B C Tripathi said.
Sources- The New Indian Express.
GS Paper III- Economic Development.
RBI Lifts Per-Borrower Loan Cap For MSMEs.
- In view of the increasing importance of the services sector and to encourage banks to lend more to this sector, the Reserve Bank of India has decided to do away with the per borrower loan limits to Micro/ Small and Medium Enterprises (Services) for classification under priority sector lending.
- So far, loans to Micro/ Small and Medium Enterprises (Services) up to ₹5 crore and ₹10 crore, respectively, were classified as priority sector lending (PSL).
Highlights Of The Development-
- Since the per borrower loan limits to Micro/ Small and Medium Enterprises (Services) have been removed, all bank loans to MSMEs engaged in providing or rendering services as defined in terms of investment in equipment under the MSMED Act, 2006, will qualify under priority sector without any credit cap, the RBI said in a notification.
- According to the MSMED (Micro, Small and Medium Enterprises Development) Act, 2006, in the case of the services sector, micro and small enterprises are entities where the investment in equipment does not exceed ₹10 lakh and more but not exceeding ₹2 crore.
- A medium enterprise is an entity where the investment in equipment is more than ₹2 crore but not exceeding ₹5 crore.
- Priority Sector lending usually includes lending to segments such as agriculture; micro, small and medium enterprises; export credit; education; housing; social infrastructure; and renewable energy.
- Meanwhile, the RBI said foreign banks with 20 or more branches will have to meet sub-targets for lending to small and marginal farmers and micro enterprises from FY2018-19, according to the Reserve Bank of India.
Sources- The Hindu Business Line.