CNBC TV 18 | Budget capex boost of 33% for energy transition will benefit every sector, says Hardeep Singh Puri

Feb 01,2023

Finance Minister Nirmala Sitharaman announced Rs 35,000 crore for priority capital investment towards energy transition and net zero objectives and energy security by the Ministry of Petroleum and Natural Gas.

Hardeep Singh Puri, Minister for Housing, Urban Affairs and Petroleum and Natural Gas told CNBC-TV18, “the capex increase of 33 percent to take it to Rs 10 lakh crore is something that will benefit every sector.”

Meanwhile, the Finance Ministry clarified that as part of the Rs 35,000 capital expenditure announced, Rs 5,000 crore is for strategic storage filling of oil reserves and Rs 30,000 crore capital support would be for oil marketing companies (OMCs) to take up projects that contribute towards the goals of the energy transition, security, and net-zero carbon emissions target by 2070.

According to Puri, the mandatory five percent Compressed Bio Gas (CBG) blending will result in a greater offtake of biogas. He sees the budget as a little push required for CBG with the government's focus on green growth.

Reflecting on the allocation of funds for urban infrastructure, he pointed to the attention to detail in the Budget in terms of the requirements of tier 2 and 3 cities from the Urban Development Fund. He mentioned that subsidies have a defined purpose.

“All these urban spends are not just government expenditure, the government steps in, then you have the state government because the land is a state subject, the states will be encouraged to come in, then there will be a public-private partnership as you have in the Smart City Mission,” Puri said.

Puri is hopeful that the government's display of high sensitivity towards subsidies will lead to OMCs (oil marketing companies) no longer having to bear the costs.

He also spoke on the current state of inflation, stating that it is under control, and he is hopeful that prices will remain within a band, thus negating the need for subsidies. In conclusion, Puri presented an optimistic outlook for the budget, highlighting its focus on green growth, urban development, and the control of inflation.