New Delhi: A parliamentary standing committee has called for a uniform Research and Development (R&D) spending benchmark across oil public sector undertakings (PSUs), saying they spend varying shares of their profits on R&D despite common challenges around energy transition, technology and energy security.
The Standing Committee on Petroleum and Natural Gas, in its 9th Report on R&D activities of oil PSUs, tabled in Parliament last week, recommended that the government consider establishing a minimum R&D expenditure for all oil PSUs, preferably as a percentage of their profit before tax.
The committee also noted that R&D spending by oil PSUs has increased over the past five years. Their combined expenditure rose from Rs 2,083.6 crore in 2021-22 to Rs 2,908.95 crore in 2025-26, according to data provided by the petroleum ministry.
However, the proportion of profits being allocated to R&D varies considerably. In 2025-26, seven major PSUs together spent about 2.16 percent of their profit after tax on R&D.
ONGC spent 2.26 percent of its profit on R&D, while Indian Oil Corporation spent 1.64 percent and Bharat Petroleum (BPCL) 1.27 percent.
The corresponding figures were 3 percent for Hindustan Petroleum (HPCL), 3.89 percent for Oil India Limited (OIL), 3.77 percent for GAIL (Gas Authority of India Limited) and 3.36 percent for Engineers India Ltd.
“The Committee are of the view that a uniform R&D investment norm across PSUs may be explored for sustained innovation and technological advancement in petroleum sector,” the report said.
Also Read: Hiking capex not enough, boost oil output, expand strategic reserves faster—House panel to govt
Talent pipeline
The committee also flagged the need for better long-term planning for R&D manpower, but stopped short of describing the issue as an outright shortage of scientists.
Oil PSUs currently recruit through open advertisements, campus placements, fixed-term specialist appointments and deputation. In the last three years, HPCL recruited 34 scientists for R&D, while BPCL recruited seven and OIL four.
The committee, however, said the ministry’s largely requirement-based approach could weaken the creation of a continuous talent pipeline for emerging technologies.
“The Ministry has stated that the R&D recruitment is largely requirement based which the Committee feel is detrimental to maintaining a continuous talent pipeline aligned to long term national energy priorities,” the report stated.
The panel recommended a dedicated R&D career track, performance-linked incentives for patents that are deployed and technologies that generate royalties, and a common HR framework across oil PSUs.
It also asked PSUs to project manpower requirements in emerging technology areas at least three years in advance.
Patents not translating into enough revenue
Another major concern is weak commercialisation of research. The committee found that oil PSUs have built a large portfolio of patents and technologies and use many internally, but earn relatively little by selling or licensing them.
The report said PSUs have “many technologies or inventions in hand” but lack a structured mechanism to scale them up and take them to market.
The committee wants patents to be treated as part of the business portfolio, with company-specific monetisation targets and key performance indicators, so oil PSUs can become technology suppliers rather than primarily technology buyers. “The Committee are of the considered view that Oil and Gas PSUs should treat patent generation and monetisation as a strategic pillar for revenue and competitiveness,” the report stated.
The committee also recommended that the ministry and oil PSUs set company-specific targets and key performance indicators (KPIs) for monetising patents and technologies, based on each PSU’s performance. This, it said, would help oil PSUs move beyond being asset owners and technology buyers to becoming active suppliers of technologies.
Fragmented research
The committee noted that oil PSUs have developed several R&D centres to work on areas such as refining, alternative fuels, catalysts and cleaner technologies.
However, it found that there is no clear mechanism of coordination among these centres, raising the risk of duplication and limiting collaboration across PSUs.
This is important as companies are expanding their R&D infrastructure. Indian Oil is setting up a second campus in Faridabad for Rs 3,199 crore, while HPCL and GAIL are also developing new facilities.
The committee also found that there is no common system to assess the performance of research centres.
At present, PSUs mainly track patents, research papers and technology demonstrations. The panel wants common benchmarks that also measure whether research is being transferred to industry and adopted commercially.
Overall, the committee called for a greater focus on pure science and fundamental research, which may not deliver immediate commercial results but can support long-term innovation.
(Edited by Sugita Katyal)