History of Petroleum

The article, published in 1979, examines the oil policy of the British colonial government in India  in the last fifty years of the Raj. It argues that the colonial government was not subservient to British oil companies such as Burmah Oil, and it did not exclude foreign-owned companies from India for this reason.  In fact, the colonial government initially pursued a development strategy designed to foster an infant industry using experimental borings and preliminary geological surveys, tariff protection, and the exclusion of companies whose policies were believed to be inimical to the rapid
development of the Burma oilfields.  Criticism of the Raj's oil policy needs to be directed to the years after I905. Firstly, the coincidence that the suspicious 'trusts' Standard Oil and Shell were also 'foreign', and the determination of the British Admiralty that the one major oilfield in the British Empire should be exploited by British companies, led to a decision to exclude all foreign capital from India's oilfields. The exclusion of 'foreign' oil companies almost certainly slowed down the development of any new oilfields in India, leaving
Burmah Oil free to hold concessions which the company had little intention of developing. Meanwhile, the Government's continued policy of encouraging competition among the small British oil companies gave rise to wasteful methods of exploitation of the existing Burmese oilfields.
The second major problem was the stagnation of the Government of India's oil policies. The decision to exclude all foreign companies was retained long after the reasons for its adoption had ceased to exist. There were no new policies to fit the new circumstances. The State continued
to undertake no exploration activity, and would offer no inducement to the oil companies to search for oil in India. Nor were new policies developed  to protect consumers from the cartelization of the Indian oil markets. The
picture is one of a reasonable start being made in the years before the First World War, but then of the retention of pre-war policies and attitudes long after they had become obsolete.