IBLA 2023 | Will be proud as an Indian to host COP33 in 2028, says Hardeep Singh Puri — Full Q&A

Hardeep Singh Puri, the Union Minister for Petroleum and Natural Gas, and Housing and Urban Affairs, during a freewheeling chat with CNBC-TV18 Managing Editor Shereen Bhan at the 19th edition of CNBC-TV18's India Business Leadership (IBLA) held in Mumbai on Saturday, December 2, held forth on a range of issues, from politics to business to economy. Interestingly, Puri joked that he should be made the Minister for Renewable Energy, while speaking about the strides India is making, under his guidance, towards clean energy,

A: The statement was made only yesterday. And I think you saw it as soon as I saw it, therefore, there is no claim to inside knowledge that I have. But I can tell you, it's a brilliant decision. As a citizen of India, I welcome it for a variety of reasons. Number one, since the several meetings of the UNFCCC or the COP meetings, India has moved very quickly, to reposition itself. I mean, the earlier discourse was about the polluter pays principle, you are responsible, he is responsible, we've now reached the stage where we acknowledge whoever is responsible, and we also have a duty to our next generation, we've got to leave the planet in a slightly better position than we inherited it and the rate at which we are going we're probably going to, it's going to be worse. But before we go to COP, and what will happen five years from now, etc. Let me just say that the kind of people, leaders of industry that you're honouring here today, they would have made a mark, even if they had not been in India, they would have been in any other world. So let's start by applauding that. And now we see the entire ecosystem shifting from fossil fuel to green sustainable energy, from traditional, polluting ways of doing business to this thing. So I think it's only appropriate that the Prime Minister has positioned India, I think he's put in a claim for the COP meeting in 2028. I believe there's a process which you have to undergo. But I think considering the kind of effort being made in India, I'm sure that the Indian desire to host that event- and what happens is if you host the G20, the preparation for the event itself acts as a very major incentive for different parts of the economy, the ecosystem, all the industry, everybody to start focusing on that. So if you're hosting a COP meeting, I'm personally delighted, but I'm not going to make any pronouncements on that.

But I'll tell you there is something fascinating happening. This COP meeting was hosted or is still being hosted by a country which is a major fossil fuel producer. And yet that country wants to transition.

Now, I think therein lies the dilemma or rather the dilemma to understand what is happening in the world. I mean, the UN Secretary-General made a statement and I'm an old friend of his, we served together in Geneva, many, many years ago, and he said that if the planet is on fire, you cannot use a garden hose or something to put out the fire. True. But we are living in a complicated world where almost any outlandish statement that you make could be true. You need to transition from fossil fuel to green energy, India's doing it faster. I also believe that when there's turbulence in the global market, the transitioning takes place faster. But you have to be realistic. If you were to suddenly stop the use of existing brands or a kind of energy, whatever they be, you would have chaos. You saw that during the economic meltdown. Once the economy closes down, then you move to a crisis in livelihood. So I think what we need to do, and I'm sure that the Indian position which has always been forward-looking and constructive, we will navigate from the current situation, we already changed our position in Glasgow. I remember when the Prime Minister was on the flight between I think, Paris and Glasgow, suddenly, when he reached there, and he made pronouncements, I think the bureaucracy was taken aback, because he said you have to be part of the solution. And I think with India, expecting to host the meeting in 2028, which will mean that you will have a more focused vigorous Indian leadership of issues relating to climate change both within the country and in the international arena.

A: I have some good news to give you. The problem is not the oil marketing companies, if we have a national target of net zero by 2070, all the oil marketing companies have targets before 2040. Most of them are 2035 or 2040. So, they are already on the way there. I mean, I should not be called the minister for petroleum and natural gas, I should be called the minister for energy transition.

A: No, this is not something you suggest to the Prime Minister. The IOCL has 11 refineries two of them are already devoted to green hydrogen, I keep playing one against the other. Today, I told BPCL when I was reviewing their performance, I said when I joined in 2021, July I was associated with this ministry this was a company up for sale, their half-yearly profit was ₹19,000 crore net profit after tax, a company that you wanted to privatise in July 2021, today is going to end up with a profit like this. And what was the presentation to me on? Sir, we are in collaboration with such and such company to make electrolysers, we are setting up a green hydrogen power plant, that is the real story.

A: You want to privatise a company which will end up with ₹50,000 crore profit? So I turned around and asked who put the privatisation on the table? Certainly not my ministry. What happens is different parts of our system function with a view to achieving results. I was also the minister of civil aviation, when you privatised Air India, and not because of anything else, one initial belief like Amitabh Kant gives me tutorials on how the private sector is very efficient, the companies are very efficient. But I couldn't go to my senior colleagues every year with folded hands and ask for ₹8,000 crore to run Air India and what happened? All the aircraft manufacturers are laughing their way to the bank, an order has been placed by an Indian airline- I mean Air India and another private sector large share player of 1,000 planes. Now, if you do the correct kind of decision-making, you get good results.

A: I just want to understand why you privatise companies. It is because either you don't know how to run them, or they make losses, etc. But I just gave you the figures. I mean, this profit of ₹19,000 crore I asked him today, he said we've never made this profit in our life. Well, I had some fun. I called another company which claims to be the 7th largest in the world. They're friends of mine. So I said, these guys are doing very well. So he started giving me a long explanation. They're doing well because their refineries are on the coast. But it's a happy situation that despite taking huge under-recoveries or having under-recoveries during the pandemic, we were the only country in the world where the petrol prices came down 11% over a two-year reference period, everywhere in the world, they went up by 30-40%. Around India, it was even more stark. And they took a cut, but they took a cut because I told one of them, we are a 7,000-year-old civilisation, do me a favour for one year don't crib, just think of the consumer first and they played ball and today they're all doing quite well.

A: I have to be very careful. Anything I say here, will not remain within the confines of this very eminent gathering. But I'll tell you another thing, OPEC+ had a meeting yesterday, I went to Vienna just about a few days ago, and I told the OPEC secretary general, that my position as petroleum minister has never been, please reduce the price. The energy is a sovereign asset you've got, you do what you want with it, you want to leave it underground, you want to extract it, you want to extract more of it, entirely your call. But let me remind you, there was a time in 2008, when energy prices went up. With the current situation where half the world is in recession, and the other half is flirting with recession, if oil prices go up, demand is going to drop. Well, yesterday they added to their 1 million barrels a day cut, and they put another million barrels on the table. And you know what happened to the oil market? It came down, came down to $79 a barrel. I don't want to tempt fate. But I can tell you, whatever is happening in the world today, we need energy prices to remain stable and predictable. Somebody asked me how low do you want them? I said no, I'm a consumer, I'd want them very low, but you're not going to reduce them because I or India wants it too low. Regarding the situation in the Middle East, again, I don't want to tread on other people's toes, we have managed it so far. Hamas is a terrorist group, we condemn the attack, but we still believe and so does the rest of the world, and we've reiterated it the Prime Minister has reiterated it, the Palestinian people are not a terrorist group. The Israelis have a right to coexist. Israel has a right to exist and any terror attack on them has to be condemned. So I'm glad that there was a ceasefire, which has resulted in the release of 39 or more prisoners. I am hoping as has been said by the Indian state system at the highest level, that better sense will prevail, that the remaining hostages will be freed, and that the focus will be towards peace rather than a resumption of hostilities, the cessation of hostilities for the interim period was good. I hope it can continue. You know,

A: I have one position — I'd like to make LPG distribution free, but then I also have a senior colleague sitting in North Block. There was a loss that the companies incurred, I think of ₹28,000 crore. We are grateful to them, that they showed sensitivity. Some other companies did not do it, we're not happy about that. But that's their sovereign, that's their commercial decision. We compensated them for ₹22,000 crore out of the ₹28,000 crore they lost. I'm glad their results have been good subsequently and they have not only reclaimed, so I keep telling them now that you have made the money, next time you need to look at prices, they all smile. But look they're answerable to their shareholders. The government has a limited role to play when you are dealing with those- I don't know how much revenue the OMCs together collect – I think over 20% of the government’s revenue comes from these companies. So they are responsible corporate citizens.

A: India is not just a sweet spot, you are the one country in the world which has its act together. So don't be defensive about that. And the reason you've got your act together is because the private sector which is a dynamo of wealth creation is doing a damn good job. So let's celebrate that. I don't know why I'm in a provocative mood because I've been traveling relentlessly over the last 10 days. I feel very happy personally, when I see cross-fertilisation, I mean people who were in the finance ministry now joining the board of Hindustan Unilever, I think it's a damn good choice. I mean, why do people who work in the government only want to be in the government? I should encourage a lot of people to leave the government and go to the private sector? Let me give you the priorities, let's be very clear, whether you buy the undiluted 7.6% in the second quarter- April, May, June was good, July, August, September is even better, as I think the upcoming one October, November, December will be still better. What we need to do is to move to the mindset that, and the Prime Minister I think is leading the charge on that, that you are moving in the direction of becoming a developed nation. And please acknowledge the contribution of those who are making it possible. And I am hoping that when we go into 2024, and after that, that is the real story after 2024. There are some guys who still think that they have an alternate formulation, but I think they are somewhat delusional. I think the economy post-2024 will show these kinds of results- and I read a very long article today, an analysis that last year, that period was negative, it doesn't matter. Even if that was negative, if this one had not been 7.6%, what would have happened? You would have been low.

I read another article with somebody whom I don't always agree with, that when you look at GDP figures, look at the hard reality, and avoid the decibel music surrounding that. But I'm very confident and I think we are in for even more, so don't just call it a sweet spot. We are the country which has its act together.