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Economic Analysis for the Indian Energy IndustryPublished by: Frost & Sullivan Published: Jun. 11, 2007 - 33 Pages Table of Contents
AbstractEnergy demand in Asia is expected to grow significantly on the back of substantial economic growth. Asia has been emphasizing on energy independence by developing economically viable alternate fuels such as renewable energy, hydroelectricity, and biofuels. The recent spectacular growth of the Indian economy was based on sound economic fundamentals and this trend is likely to continue. The country’s gross domestic product (GDP) is expected to grow by 7.4 percent during the fiscal year 2006-2007. Strategic sectors including aviation, telecommunications, banking and financial services, construction, and services sectors such as healthcare have been showing tremendous growth potential since 2003. Once these prospects are tapped, the economy is likely to accelerate between 2007 and 2010.The reform process, which has deregulated the Indian economy and has given a boost to domestic and foreign investments, is expected to continue at the same pace. This trend, supported by flexible tax structures, will make India one of the prime global destinations for business. The economic prospects of the country are looking up as per capita incomes have risen, prices stabilized, and the exchange rate volatility, diminished. The oil and gas sector is also one of the largest contributors to the central and state exchequer. Indian companies have also begun to venture overseas, thus improving the country’s energy security. Since the 1990s, the Government has made considerable progress in nurturing the economy by encouraging private sector activity. India’s foreign direct investment (FDI) policies are liberal and transparent. FDI of up to 74.0 percent is allowed for the exploration of coal for captive consumption and up to 100 percent FDI is allowed for the setting up coal processing plants, oil and gas exploration from small and medium fields, and construction of petroleum products pipeline. The country is emerging as a major consumer of oil products, creating a considerable need for the large-scale expansion of onshore and offshore exploration and extraction. Due to the Government’s inability to invest heavily in oil exploration, large-scale private sector inflows are essential to augment capacity in the oil industry. The infrastructure related to the marketing of petroleum products has been allotted FDI of up to 74.0 percent. Huge opportunities exist in the private sector, particularly for foreign companies setting up their own projects or joint ventures with public sector companies. Clean coal technology can be used to alleviate environmental effects such as pollution. This technology will soon be commercially available in India due to the country’s growing concern for the environment. The Ministry of Non-Conventional Energy Sources aims to install an additional 10.0 percent of renewable power generation capacity by 2012 through the grid-interactive renewable power program. This will require both external funding and technological expertise. India is planning to enhance R&D efforts in the field of exploration and production of energy resources. Research will be especially focused on offshore natural gas exploration and extraction of coal from deep and in-site coal gasification. This will provide opportunities for equipment manufacturers and suppliers to the oil and gas industry. This Frost & Sullivan Country Industry Forecast service for the Indian energy industry uses a macroeconomic perspective to provide a focused analysis of the industry. This service covers an array of issues pertinent to the energy industry, ranging from political stances, trade policies, and industry regulations along with their overall impact. Besides enabling decision makers to assess the impact of non-market forces, this analysis also helps in identifying new opportunities in the industry. In addition, it provides a strong base for preparing business contingency plans. Benefits of this Service Identify New Market Opportunities The future trends of the economic environment of India have been analyzed along with their impact on energy industry. This analysis will provide valuable information to industry participants on opportunities in specific segments of the industry. Understand Future Industry Trends The research gives an insight into the energy industry, discusses its dependence on the prevailing economic scenario, and forecasts its future. This will help industry participants to gauge the future direction of the industry, enabling them to devise appropriate strategies to improve market share. Comprehend Policy and Regulatory Environment A detailed analysis of the economic framework of the Indian energy industry offers insights into the economic parameters as they exist and the future direction of the same. This is particularly beneficial in the case of the energy industry, as these economic indicators form an important criterion for industry performance. Devise Country Entry Strategies The research provides valuable information and analysis of the strengths and weaknesses of the economy of India, which are relevant for the energy industry. This is particularly useful in devising country-specific strategies for industry participants. Evaluate Industry Segment Potential This study offers detailed coverage of economic issues affecting the industry and their future direction. It provides both country and industry trends and forecasts for major variables and is an excellent tool for companies that plan to enter new geographic markets. This will help corporate planners in developing accurate business plans and enhance credibility to planning company resources. Get Full Details About This Report >> |
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