The majority of the villages are not connected to the grid; the LPG cylinder is a promise that is seldom kept; the subsidised kerosene finds its way more often into the generators of the relatively wealthy than into the lanterns of the poor; solar lighting system has disappointed because of poor and erratic service. The forests of Binsar are thick and replete. But if the energy situation remains as it is today, it will inevitably degrade. What is now required is a multi-pronged energy solution within an integrated and holistic framework. And someone who can galvanise action across all fronts.

Against the backdrop of a $100 plus price of oil and the associated challenge of global warming, many energy import dependent countries have enunciated their vision for an energy future. The United States has promulgated a new Energy Security and Independence Act. The Act mandates that by 2022 the country must replace 1 million barrels of transportation gasoline per day by its equivalent in bio fuels. And that the average fuel efficiency of passenger cars and light trucks sold in the US must be 35 miles per gallon (mpg) as against the current standards of 27.5 mpg for cars and 22.2 mpg for light trucks. The European Union has prescribed a 20:20:20 vision. It has targeted to reduce greenhouse gas emissions by 20 per cent over the 1990 levels; to improve energy efficiency by 20 per cent over current levels and to increase the share of renewables in the energy consumption basket to 20 per cent — by 2020. China has announced ambitious targets to reduce its dependency on fossil fuels and to weaken the link between economic growth, energy demand and environmental pollution.

We stand out as an exception. The Planning Commission has prepared an integrated energy policy document but there is little evidence that its contents are the touchstones of energy policy. There is certainly no one energy czar in the country with the executive mandate to pull together the divergent threads that originate from the five ministries handling energy related issues (ministries of petroleum, coal, non-conventional, atomic and power)! And no one therefore with the authority (other than the PM) to push the country in the direction of sustainable energy security.

In this context, I was somewhat disappointed by the budget speech. The finance minister did in the main offer a pragmatic and balanced budget. He walked well the tightrope between the pressures of an election year and the importance of maintaining the momentum of growth. He opened the spigots of finance but without structurally undermining the requirements of fiscal prudence. And he met expectations by not doing anything radically unexpected. But in the specific context of energy he disappointed by not spelling out the contours of an energy future.

I accept that the budget speech is not the occasion for a digression on energy. And that the FM is not the responsible minister to pronounce on the direction of energy policy. But given that the budget speech is the closest we have to a nationally televised and commented ‘state of the union’ message; and given the criticality of this issue, I had hoped the budget speech would include a paragraph that brought coherence to energy policy and through a set of specific fiscal incentives and investment proposals move us more aggressively in the direction of a non-fossil fuel future.

My disappointment was compounded by the fact that the FM did touch on all of the critical issues. But he did not take the next step and place his allusions and comments within an integrated energy framework. Nor did he offer any incentives. On the contrary, as the subsequent reading of the finance bill suggests, the budget speech may have been no more than sound rhetoric.

Take, for instance, the comment on exploration. The budget speech alluded to the importance of intensifying oil and gas exploration. It pointedly pronounced on the billions of incremental dollars that the government expected to flow into fresh exploration under the new exploration licensing round (NELP VII). The finance bill (2008) has however purportedly (I say purportedly because I am still not clear as to its intent) removed the seven-year tax holiday on the profits to be earned from the production of natural gas. Given that the notice inviting offers (NIOs) for exploration under NELP specifically mentions this tax holiday; given that it is not possible to ascertain ahead of physical drilling whether the discovered hydrocarbons will be oil, gas or oil associated with gas and given that the bulk of recent discoveries have all been gas, this inherent contradiction between the pronouncement in Parliament and the subsequent fine print is intriguing, to say the least.

Take, also, the disjunct between the commendable reference to climate change and the need for India to address this challenge irrespective of the outcome of multilateral and international discussions and the absence of any specific incentives to accelerate the development of cleaner fuels or to encourage R&D on cleaner technologies. The FM said gas was the most ‘benign’ of fossil fuels. But he did not go the logical next step and grant the gas industry the same concessions that infrastructure related industries currently receive.

The FM is not the custodian of India’s energy policy. But in the absence of any such custodian I do not think it would be out of line for him to use his privileged access to the nation to galvanise government, corporates and civil society down the path of sustainable energy solutions. For, clearly, if such solutions are not found, the villagers of Binsar will not be alone in their disappointment.

The writer is chairman of the Shell Group in India. Views are personal