Rising imports of crude and petroleum products has led to a severe problem in balance of payments. On the other hand, the costs and prices of a wide range of goods have increased due to global inflation in oil. Inspite of stringent monetary and fiscal controls, the wholesale price index in India has been continuously rising. With such high reliance on imported energy products, a significant proportion of the export earnings, which otherwise could be channelled into productive domestic investments, is used to meet expenditure on these imported products. Therefore, India's dependence on foreign countries for crude and petroleum products is a negative feature of our energy sector.