India's Biggest Offshore Oil Bet: Rs 84,084-Crore Mission to Cut Import Dependence

India has launched its most ambitious offshore energy exploration programme yet, approving the Rs 84,084-crore Samudra Manthan National Offshore Exploration Scheme to unlock untapped oil and natural gas reserves beneath Indian waters and reduce the country's growing dependence on imported fuel.

The Union Cabinet recently cleared the scheme, under which the government will directly share the financial risk of deep-sea exploration by funding 50 per cent of the cost of drilling a deepwater or ultra-deepwater exploratory well, or up to Rs 650 crore per well, whichever is lower. Over the next five years, 60 offshore exploratory wells will receive government support, making it one of the world's first large-scale programmes where exploration risk is funded directly through the national budget.

The initiative aims to encourage private and global energy companies to invest in deepwater exploration, an area they have largely avoided because unsuccessful drilling can result in massive financial losses. Officials believe government support will revive exploration activity and help uncover new hydrocarbon reserves that have remained untapped for decades.

Of the total outlay, Rs 43,200 crore has been earmarked for drilling support, while Rs 28,534 crore will fund offshore seismic surveys and geological data acquisition to identify promising reserves. Another Rs 10,000 crore will be spent on common infrastructure such as subsea pipelines and processing facilities, enabling multiple operators to share assets and reduce project costs. An additional Rs 2,000 crore has been allocated for developing oil and gas manufacturing and services hubs.

According to ICRA, the scheme could add 10-15 million tonnes of oil equivalent annually, helping reduce India's oil and gas import dependence by 3-5 per cent over time. India currently imports around 88 per cent of its crude oil and nearly half of its natural gas requirements, making the country vulnerable to global supply disruptions and price volatility.

The programme also builds on recent reforms, including the Hydrocarbon Exploration and Licensing Policy (HELP), the Open Acreage Licensing Policy (OALP) and the Oilfields (Regulation and Development) Amendment Act, 2025, aimed at making India's upstream sector more attractive to investors.

Though deep-sea exploration remains costly and uncertain, the government sees the initiative as a long-term investment in energy security, domestic production and reduced reliance on imported fuels.