“We propose to create an integrated public sector ‘oil major’ which will be able to match the performance of international and domestic private sector oil and gas companies.” With this Budget 2017 speech Finance Minister set the ball rolling on merger of public sector oil companies. Analysts have welcomed the move but say that such a step will face a lot of challenges, particularly on the execution front. “Proposals to consolidate India’s oil & gas sector have been floated before, but last week the idea was presented in a budget speech for the first time. No details have yet been provided on which companies would be involved, but the aim is to create an integrated public sector oil major,” Fitch Ratings in a note.
Here is what Fitch Ratings says on the Budget proposal:
1) A proposed merger of India’s state-controlled oil companies could reduce inefficiencies across the sector. It would also create an entity that is better placed to compete globally for resources, and less vulnerable to shifts in oil prices. Read More…
Credit By : Ndtv
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