Question 70 from UPSC CSE 2025 - Economics

Question

Consider the following activities:
I. Production of crude oil
II. Refining, storage and distribution of petroleum
III. Marketing and sale of petroleum products
IV. Production of natural gas
How many of the above activities are regulated by the Petroleum and Natural Gas Regulatory Board in our country?

IASCODEX · Accepted Answer

Correct Option: B. Only two

Strategy: Focus on the mandate of the Petroleum and Natural Gas Regulatory Board (PNGRB). Its regulatory scope does not extend to the production (exploration/extraction) of crude oil or natural gas, but covers refining, storage, distribution, marketing and sale of petroleum products. So, from the four activities listed, only 'Refining, storage and distribution of petroleum' and 'Marketing and sale of petroleum products' fit under PNGRB regulation, making the answer 'only two activities'.

Key Info: The Petroleum and Natural Gas Regulatory Board (PNGRB) is a statutory regulatory body established under the Petroleum and Natural Gas Regulatory Board Act, 2006. Its primary role is the regulation of downstream activities related to petroleum, petroleum products, and natural gas, except for production. Key activities regulated by PNGRB include:

* Refining, processing, storage, transportation, distribution, marketing, and sale of petroleum, petroleum products and natural gas.
* Infrastructure authorization: Licensing and regulating the laying, building, operating, or expanding pipelines for the transportation/distribution of petroleum, petroleum products, and natural gas.
* Pricing: Overseeing access and tariffs for common carrier pipelines and city/local natural gas distribution networks.
* Consumer protection: Ensuring fair trade and equitable access; handling related grievances.

Excluded from PNGRB's regulatory domain are:
* Upstream activities: Exploration and production of crude oil and natural gas, which are regulated by the Ministry of Petroleum & Natural Gas and agencies such as the Directorate General of Hydrocarbons (DGH).
* Strategic or administrative controls on the allocation and licensing of natural resources (crude, gas), which remain governmental prerogatives.

Thus, among the four listed activities:
* Production of crude oil (I) and production of natural gas (IV) are not under PNGRB.
* Refining, storage and distribution of petroleum (II), and marketing and sale of petroleum products (III) are regulated by PNGRB.

Relevant statutes: Petroleum and Natural Gas Regulatory Board Act, 2006; Ministry of Petroleum & Natural Gas notifications.
Example agencies: Oil & Natural Gas Corporation (ONGC) for production, Indian Oil Corporation for refining and marketing.

IASCODEX · Answer

Option A: Only one

IASCODEX · Answer

Option C: Only three

IASCODEX · Answer

Option D: All four