From Raha to Reality: India’s Unfinished Energy Security Agenda

India’s energy security gaps persist as policy inconsistency, weak reserves, and slow overseas expansion dilute long-term strategic resilience.

Cover Image Attribute: The portrait of Late Subir Raha / Source: Atul Kasbekar

When Subir Raha assumed leadership of the Oil and Natural Gas Corporation (ONGC) in May 2001, India’s energy landscape was defined by acute vulnerability. With just 0.4 percent of global hydrocarbon reserves yet 15 percent of the world’s population, the country depended heavily on imports for its growing economy. Over the next five years, Raha steered ONGC toward a more ambitious posture, one that treated oil and gas not solely as commercial resources but as strategic assets essential to national resilience. Under his tenure, the company’s market capitalization expanded more than tenfold, reaching approximately $28 billion by 2006, while net profits rose sharply, from ₹8,664 crore in the prior year to ₹12,175 crore in 2004-05. ONGC acquired the chronically ailing Mangalore Refinery and Petrochemicals Limited in 2003, transforming it into a profit-making downstream operation within months. More significantly, ONGC Videsh Limited, the overseas arm, secured stakes in multiple international projects, operating across 14 properties in 12 countries by the mid-2000s and acquiring five additional exploration assets in a single financial year. Ventures such as participation in Russia’s Sakhalin fields and explorations in Vietnam underscored a deliberate push to secure equity oil and gas from diverse geographies, including Africa, Latin America, and the Russian Far East. Raha’s approach rested on three interlocking pillars: aggressive overseas asset acquisition to compete with better-resourced state-backed players elsewhere, early advocacy for buffered stockpiles against supply disruptions, and a broader doctrine that framed hydrocarbons as instruments of national security rather than mere market commodities.
The decision not to extend Raha’s contract in 2006, despite the company’s upward trajectory, represented a notable inflection. ONGC lost its status as the country’s most valuable enterprise in the same year, and leadership transitions introduced greater bureaucratic oversight. The shift coincided with broader governmental recalibrations under the United Progressive Alliance (UPA), where fiscal pressures and coalition politics increasingly shaped energy decisions. What followed was not outright rejection of the earlier strategic framework but a gradual attenuation of its urgency and coherence across subsequent administrations. Overseas pursuits continued, yet they encountered mounting competition and internal constraints. Strategic petroleum reserves, conceptualized in the early 2000s with the incorporation of the Indian Strategic Petroleum Reserves Limited in 2004, advanced in fits and starts. Domestic exploration policies evolved, yet import dependence remained stubbornly high. Throughout, structural frictions—bureaucratic inertia, fragmented decision-making, and tensions between public-sector autonomy and political control—persisted irrespective of the party in power, diluting the long-term orientation Raha had championed.
In the realm of overseas acquisitions, the post-2006 period revealed both continuity and lost momentum. ONGC Videsh expanded its portfolio, eventually managing assets in regions such as Mozambique, Brazil, and Myanmar, building on foundations laid earlier. Production from international operations grew, contributing meaningfully to equity oil supplies. Yet the pace and scale lagged behind those of Chinese national oil companies, which deployed state financing and swift diplomatic backing to secure larger stakes across Africa and Central Asia during the same period. Indian efforts faced repeated hurdles, including protracted approval processes, funding limitations, and occasional political hesitations at home that slowed bidding and deal closures. Where Chinese entities could move decisively on high-value opportunities, Indian state-owned players often contended with inter-ministerial clearances and risk-averse financing models. The result was not total stagnation but a relative ceding of ground in the global scramble for upstream resources. By the 2010s, India’s overseas production contributed to supply diversification, yet it fell short of creating the robust, diversified portfolio that might have insulated the economy more effectively from geopolitical volatility in traditional suppliers.
Parallel to this, the strategic petroleum reserves program, intended as a core buffer against supply shocks and price spikes, illustrated policy execution gaps. Initial plans gained traction in the early 2000s, with Phase I facilities at Mangaluru, Visakhapatnam, and Padur designed to hold 5.33 million metric tons—roughly equivalent to nine-and-a-half days of crude cover at full capacity. These sites became operational between 2015 and 2018, yet utilization hovered around 64 percent in recent assessments, with actual stocks equating to far fewer days of effective emergency supply amid ongoing crises. Phase II expansions, including additional caverns at Chandikhol and further capacity at Padur, received approvals in the late 2010s and early 2020s but encountered repeated delays stemming from land acquisition disputes, coordination challenges between central and state governments, and budgetary shortfalls. As recently as 2025 and 2026, parliamentary committees highlighted underspending on reserve filling, while feasibility studies for new sites in Rajasthan, Karnataka, and Madhya Pradesh proceeded slowly. Successive governments treated the program as important infrastructure rather than an urgent national security imperative, resulting in a stockpile that, even when combined with commercial inventories held by refiners, offered only modest protection—far below levels maintained by peers such as Japan. In moments of West Asian instability, including the 2026 tensions involving Iran, the limited buffer exposed how delays compounded vulnerability.
During the UPA years under Prime Minister Manmohan Singh, energy policy balanced competing domestic priorities. The New Exploration Licensing Policy (NELP) sought to invigorate domestic upstream activity by opening acreage to private and foreign participation, yielding some discoveries. Yet heavy fuel subsidies, financed partly through oil bonds totaling over Rs 1.34 lakh crore, strained the finances of public-sector undertakings. ONGC and other national oil companies absorbed under-recoveries on diesel, kerosene, and liquefied petroleum gas, constraining their capacity for capital expenditure in exploration and overseas ventures. Price controls distorted market signals, while the fiscal burden limited aggressive pursuit of long-term security goals. Overseas strategy retained momentum in select deals, but the overall emphasis tilted toward short-term affordability over strategic stockpiling or accelerated asset acquisition. Domestic production growth remained modest, and import dependence stayed elevated, reflecting a tension between immediate consumer relief and the longer-term resilience Raha’s framework had prioritized.
The Bharatiya Janata Party-led government under Narendra Modi introduced notable reforms aimed at revitalizing the sector. The Hydrocarbon Exploration and Licensing Policy (HELP), introduced in 2016, replaced the earlier licensing regime with a revenue-sharing model intended to simplify procedures and attract investment. The Open Acreage Licensing Policy enabled year-round bidding, expanding the acreage offered for exploration. Supply diversification gained traction, particularly through increased Russian crude imports following global shifts in the 2020s. Strategic reserves saw rhetorical emphasis, with claims of capacity growth to over 5 million tons, and refining capacity expanded by tens of millions of tons. Yet domestic crude output declined in absolute terms over the decade after 2014, even as acreage awards increased, and overall import reliance persisted at 85 to 90 percent. Reserve expansion continued to face execution bottlenecks, with land issues and funding constraints persisting into 2026. Geopolitical considerations, including Middle East volatility and strengthened ties with alternative suppliers, influenced procurement, yet the underlying architecture of energy security—robust overseas holdings, full reserve buffers, and reduced vulnerability—showed incremental rather than transformative progress.
Across both political dispensations, structural constraints repeatedly undermined strategic coherence. Bureaucratic layering slowed decision-making on acquisitions and project clearances. Public-sector undertakings operated under varying degrees of ministerial oversight that sometimes prioritized short-term fiscal or political objectives over commercial agility. Underinvestment in exploration relative to consumption growth left domestic reserves underexploited, while fragmented policy coordination between petroleum, finance, and external affairs ministries hindered integrated planning. The tension between maintaining government control over national oil companies and granting them the operational freedom to compete globally remained unresolved. These issues were not unique to one administration; they reflected enduring institutional realities that diluted the urgency of treating hydrocarbons as national security pillars.
From a broader national security vantage, India’s hydrocarbon dependence constitutes a persistent strategic liability. Reliance on imported crude exposes the economy to price volatility, supply disruptions from chokepoints such as the Strait of Hormuz, and geopolitical leverage exercised by producers. China’s parallel trajectory offers a contrast: its national oil companies pursued overseas assets with greater scale and speed, backed by policy banks and diplomatic muscle, while building larger strategic reserves that provided deeper buffers. India’s efforts, though substantial in absolute terms, secured a narrower foothold during the critical 2006-2015 window when global energy markets offered opportunities amid relatively lower asset prices and shifting geopolitics. Missed bids, slower execution, and delayed reserve filling meant that by the mid-2020s, the country still confronted supply risks with limited cushion, even as consumption continued to climb.
In retrospect, India did not formally abandon the strategic doctrine articulated and advanced during Raha’s years. Elements of overseas expansion, reserve building, and policy reform persisted under both the UPA and the National Democratic Alliance (NDA). Yet execution lacked the consistency and urgency required to translate vision into durable security. Political cycles introduced shifts in emphasis—subsidies in one era, licensing liberalization in another—while institutional frictions and fiscal trade-offs repeatedly deferred harder investments. The outcome is an energy architecture that has grown more diversified yet remains import-dependent and insufficiently buffered against shocks. Closing the gap will require more than incremental tweaks: sustained political consensus on long-term priorities, streamlined decision-making that empowers commercial judgment within public-sector entities, accelerated reserve construction through public-private models, and a unified doctrine that subordinates short-term fiscal expediency to strategic resilience. Only then can hydrocarbons truly serve as a pillar of national power rather than a source of enduring vulnerability.

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