India has excellent investment climate: PM
Oil exploration major Cairn's success story demonstrates that India is an excellent destination for foreign investment, Prime Minister Manmohan Singh said in Barmer on Saturday.india Updated: Aug 29, 2009 19:15 IST
Oil exploration major Cairn's success story demonstrates that India is an excellent destination for foreign investment, Prime Minister Manmohan Singh said in Barmer on Saturday.
Speaking after inaugurating the Mangala field, India's largest oil discovery in two decades, he said: "It can be demonstrated through Cairn's contribution that there is a very good climate for investment in India".
Urging foreign investors to come to India to take advantage of the opportunities available in Rajasthan, the prime minister said: "I call on investors from different parts of the globe to come here and assure them that they will get full and honest support from the Indian government for all facilities."
Manmohan Singh turned a valve on the dais to symbolically start the Mangala field's production, amidst cheers from the assembled audience of dignitaries, employees and local people, with the Oscar-winning song "Jai Ho" playing in the background.
He was also presented with the first drops of oil from the field in a container.
The prime minister said that the inauguration of the Mangala field was bound to bring enormous prosperity to Rajasthan.
"It is a historical fact that whenever oil has been found in a country, it has developed very fast. I believe after the oil production here, there will be a new Rajasthan where there is no poverty and less unemployment.
"Our country is moving forward at a rapid rate. But to remove poverty, there is a lot left to do," Manmohan Singh said, noting if this rapid rate of growth has to be improved, there will be further need for energy.
"Energy production is taking place, but the demand for oil and gas is also increasing," he added.
Petroleum and Natural Gas Minister Murli Deora and Rajasthan Chief Minister Ashok Gehlot were present at the function, held in a massive air-conditioned tent, which had eight large screens hanging from the roof to enable the audience to watch the event closely. The site is 125 km from the India-Pakistan border.
Mangala's peak production of 125,000 barrels per day (bpd) will be reached in the first half of 2010.
Along with the production at its Bhagyam and Aishwarya fields, the aggregate peak production by Cairn India will be 175,000 bpd or 20 percent of India's domestic production - enough to power 3.4 million cars daily or fill up 4.5 million cooking gas cylinders a month.
The three fields are expected to save the country $1.5 billion annually as import bill over the next 10 years. It would also earn the government $30 billion across the life of the field by way of taxes, royalties and profit petroleum revenue.
Deora has said the central government would get Rs.46,000 crore (Rs.460 billion) as profit petroleum revenue. The Rajasthan government would get another Rs.12,000 crore (Rs.120 billion) as royalty revenue for the first five years, he said.
India imports over 70 percent of its crude oil needs. At its peak, Cairn's production will lead to cutting down about 8 percent of India's import bill at current oil prices.