Indian parliamentary panel urges minimum R&D spending for oil PSUs

The Parliamentary Standing Committee on Petroleum and Natural Gas has recommended that India’s Ministry of Petroleum and Natural Gas establish a minimum research and development (R&D) expenditure benchmark for all oil public sector undertakings (PSUs). The committee suggested that this benchmark should preferably be set as a percentage of Profit Before Tax (PBT) to ensure uniform investment across the sector.

This recommendation aims to strengthen indigenous technology and support India’s energy transition objectives amidst geopolitical uncertainties. Data from the 2025-26 financial year shows that major oil and gas PSUs spent a combined Rs 2,796 crore on R&D, which represented approximately 2.16 per cent of their combined Profit After Tax (PAT) of Rs 1,29,164.5 crore.

The committee noted significant disparities in spending among individual companies, with R&D investment ranging from 0.58 per cent to 3.89 per cent of PAT. Currently, R&D spending within these PSUs relies heavily on internal resources due to limited government budgetary support.