IDEAS home Printed from
   My bibliography  Save this paper

Social and economic impact analysis of Vadinar refinery of Essar oil: The Case of a mega refinery


  • Sumana Chaudhuri

    (Durgadevi Saraf Institute of Management Studies)

  • Shovan Ray

    () (Indira Gandhi Institute of Development Research)


The paper is a case study of Vadinar refinery in Gujarat. It examines the costs and benefits associated with one of the world's mega refinery projects highlighting the welfare impacts on society. The paper briefly examines whether refining at Vadinar by Essar is of net economic benefit to the region, state and the country by constructing a Social Cost Benefit Analysis of the Vadinar Refinery Project. The paper analyses the local-level economic impacts (on-site labor impacts, local revenue and supply chain impacts and induced impacts) and jobs supported by Vadinar refinery construction and ongoing operations. The paper also analyses the regional (state and country) level economic impacts; multiplier effect of income, tax and savings generated as a result of the refinery operations, including other externalities associated with the project. There is abundance of scope to reflect the strategic food and oil security of India from the macroeconomic perspective; the gradual increase in investor and consumer confidence with respect to self-reliance in production and consumption of oil and natural gas resources in the country and the broader social impact of the project, which may be taken up in subsequent research. A sequel to this paper will explore an approach to integrating the methods with a CGE model framework.

Suggested Citation

  • Sumana Chaudhuri & Shovan Ray, 2016. "Social and economic impact analysis of Vadinar refinery of Essar oil: The Case of a mega refinery," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2016-011, Indira Gandhi Institute of Development Research, Mumbai, India.
  • Handle: RePEc:ind:igiwpp:2016-011

    Download full text from publisher

    File URL:
    Download Restriction: no

    More about this item


    Social Cost Benefit Analysis; Economic Impact; Externalities; Oil Refinery;

    JEL classification:

    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
    • D60 - Microeconomics - - Welfare Economics - - - General
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
    • L71 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Mining, Extraction, and Refining: Hydrocarbon Fuels
    • O22 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Project Analysis
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ind:igiwpp:2016-011. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shamprasad M. Pujar). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.