Importing explosives for drilling takes 16 weeks

Vol 10, PW 4 (15 Jun 06) People & Policy

India could do much more to attract foreign investors in the upstream sector by removing unnecessary bureaucracy and red tape.

True, the oil ministry has already done much to make the system investor-friendly, but theres still more to do much more. Take the average 16 weeks required to import explosives required while drilling a well.

Says an overseas operator: This kind of delay is enough to drive anyone to despair. Why does it take so much time First we place an order with Schlumberger.

Then we go to the Directorate General of Civil Aviation for a licence to import explosives by air. Only Lufthansa flies explosives into India.

With this licence in hand the operator goes to the local office of the Directorate General of Foreign Trade. Usually, the local DGFT office replies in the negative.

After this we go to the DGFT head office in Delhi, which takes its own time to process the case and eventually grants permission. The next stop is the oil ministry, which takes just one day to give its approval.

The file with these permissions and approvals then goes for further processing to the commerce ministry. If the minister is traveling or is otherwise busy, everything gets delayed, we hear.

So one has to just wait around or engage lobbyists to speed up work in the commerce ministers office. Once the commerce minister has signed the file, the permission is published in the government of Indias gazette.

Another permission is required to complete the file. This one is from the chief controller of explosives in Nagpur, Maharashtra.

Theres no delay in his office, we hear. "They work very fast and give their approval usually in 24 hours.

With all these permissions in hand, the operator goes back to Schlumberger, which then imports the explosives. Simultaneously, the operator applies to the DGH for the essentiality certificate for waiver of import tariff on the explosives.

Most large operators employ staff only to co-ordinate this process of getting permissions to import explosives.

LNG Summit