Reliance Industries Ltd

Dear Shareholders,

Your Directors are pleased to present the 37^th Annual Report and the auditedaccounts for the financial year ended March 31, 2011.

Financial Results

The financial performance of the Company, for the year ended March 31, 2011 issummarised below:

* 1 $ = Rs. 44.595 Exchange Rate as on March 31, 2011 (1 $ = Rs. 44.90 as on March 31,2010)

Results of Operations

The first full year of operations, after commissioning of the Company’s two largescale projects namely KG D6 and SEZ refinery at Jamnagar, resulted in a record performanceduring the financial year under review.

• Turnover increased by 29% to Rs. 2,58,651 crore ($ 58.0 billion)

• Exports increased by 33% to Rs. 1,46,667 crore ($ 32.9 billion)

• PBDIT increased by 25% and achieved a record level of Rs.41,178 crore ($ 9.2billion)

• Profit Before Tax increased by 23% to Rs. 25,242 crore ($ 5.7 billion)

• Cash Profit increased by 24% to Rs. 34,530 crore ($ 7.7 billion)

• Net Profit increased by 25% to Rs. 20,286 crore ($ 4.5 billion)

• Gross Refining Margin at $ 8.4 /bbl for the year ended March 31, 2011

The Company is one of India’s largest contributors to the national exchequerprimarily by way of payment of taxes and duties to various government agencies. During theyear, a total of Rs. 28,719 crore ($ 6.4 billion) was paid in the form of various taxesand duties.

Dividend

Your Directors have recommended a dividend of Rs. 8/-per Equity Share (last year Rs.7/- per Equity Share) for the financial year ended March 31, 2011, amounting to Rs. 2772crore (inclusive of tax of Rs. 387 crore) one of the highest ever payout by any privatesector domestic company. The dividend will be paid to members whose names appear in theRegister of Members as on May 9, 2011; in respect of shares held in dematerialised form,it will be paid to members whose names are furnished by National Securities DepositoryLimited and Central Depository Services (India) Limited, as beneficial owners. Thedividend payout for the year under review has been formulated in accordance with theCompany’s policy to pay sustainable dividend linked to long term growth objectives ofthe Company to be met by internal cash accruals and the shareholders’ aspirations.

Credit Rating

The Company continues to have the highest domestic credit ratings of AAA from CRISILand Fitch. Moody’s and S&P have reaffirmed investment grade ratings forinternational debt of the Company, as Baa2 and BBB, respectively. Its continued BalanceSheet strengthning in financial year 2010-11, resulted in Moody’s, Fitch and S&Precently upgrading their outlook for the Company from Stable to Positive. TheCompany’s international rating from S&P is higher than the country’ssovereign rating. Strong credit ratings by leading international agencies reflect theCompany’s financial discipline and prudence.

Employees Stock Option Scheme

The Company implemented the Employees Stock Option Scheme(‘‘Scheme’’) in accordance with the Securities and Exchange Board ofIndia (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999(‘the SEBI Guidelines’). The Employees Stock Compensation Committee, constitutedin accordance with the SEBI Guidelines, administers and monitors the Scheme. Theapplicable disclosures as stipulated under the SEBI Guidelines as at March 31, 2011(cumulative position) are given below:

The issuance of equity shares pursuant to exercise of Options does not affect theprofit and loss account of the Company, as the exercise is made at the market priceprevailing as on the date of the grant plus taxes as applicable.

The Company has received a certificate from the Auditors of the Company that the Schemehas been implemented in accordance with the SEBI Guidelines and the resolution passed bythe shareholders. The Certificate would be placed at the Annual General Meeting forinspection by members.

Management’s Discussion and Analysis Report

Management’s Discussion and Analysis report for the year under review, asstipulated under Clause 49 of the Listing Agreement with the Stock Exchanges in India, ispresented in a separate section forming part of the Annual Report.

The Company has entered into various joint ventures, partnerships and contracts in thearea of oil and gas, refining and petrochemicals businesses. While benefits from suchcontracts will accrue in future years, their progress is periodically monitored.

In line with its aspirations of ongoing growth, Reliance is investing its resources incore business across the integrated energy chain. While doing so, the Company is alsotaking the initiative of investing in new technologies and businesses that help meetchanging aspirations of millions of Indian consumers. These strategies and initiatives areaimed at ensuring that Reliance delivers long-term sustainable growth and createsunprecedented value for all its stakeholders.

Some of the major events of the year include the following:

• RIL-BP alliance: RIL has entered into a strategic partnership with BP and signedthe relationship framework and transactional agreements. The partnership across the fullvalue chain comprises BP taking a 30% stake in 23 oil and gas production sharing contractsthat Reliance operates in India, including the producing KG-D6 block. The two companieswill also form a 50:50 joint venture for the sourcing and marketing of gas in India andwill endeavour to accelerate the creation of infrastructure for receiving, transportingand marketing of natural gas in India. BP will pay an aggregate consideration of $ 7.2billion for the interests to be acquired in the 23 production sharing contracts. Futureperformance payments of up to $ 1.8 billion could be paid based on exploration successthat results in development of commercial discoveries.

• Shale gas joint ventures: During the year, the Company, through itssubsidiaries, in the United States of America entered into three distinctive joint ventureagreements with Atlas Energy, Pioneer Natural Resources and Carrizo Oil & Gas andacquired 40%, 45% and 60% interests, respectively in the shale gas acreage positions to beexplored by these joint ventures. The net Shale acreage acquisition by Reliance is3,12,430 acres. It also entered in to a separate joint venture with Pioneer NaturalResources aimed at addressing the mid-stream opportunity in gas evacuation andtransportation.

• Joint venture for Butyl Rubber production in India: During the year, RIL andRussia’s SIBUR announced a joint venture for the setting up of a facility forproducing 100,000 MT butyl rubber in India. This is a significant step towardsReliance’s commitment to service India’s growing automotive sector by bringingin complex technologies, available with only a very few companies globally. The setting upof domestic manufacturing of butyl rubber which is expected to be commissioned by 2013,will fulfill a longstanding demand of the Indian tyre and rubber industry.

• Spearheading the knowledge revolution: During the year, RIL acquired asubstantial stake in

Infotel Broadband Services Limited (Infotel Broadband), which emerged as a successfulbidder in all the 22 circles of the auction for Broadband Wireless Access (BWA) Spectrumconducted by the Department of Telecommunications (DoT). RIL owns 95% of the equity sharecapital of Infotel Broadband. RIL sees the broadband opportunity as a new frontier ofknowledge economy in which it is confident of taking leadership position and providingIndia with an opportunity to be in the forefront among the countries providing world-class4G network and services.

• Others:

The Honorable Supreme Court of India delivered its judgment in the Reliance NaturalResources Limited (RNRL) - RIL dispute. The judgment recognized the dominant role of theprovisions of the Production Sharing Contract and upheld the policies formulated by theGovernment under which it has the authority to regulate the production and distribution ofnatural gas. RIL and RNRL signed a Gas Supply Master Agreement in compliance with the GasUtilization Policy and EGoM decisions. RIL and Reliance ADA Group companies approved andsigned an agreement canceling all existing non-compete arrangements entered into betweenthe two groups pursuant to the scheme of reorganization of the Reliance Group and enteredinto a new simpler, non-compete agreement with respect to gas based power generation.

Consolidated Financial Statements

In accordance with the Accounting Standard AS-21 on Consolidated Financial Statementsread with Accounting Standard AS-23 on Accounting for Investments in Associates and AS-27on Financial Reporting of Interest in Joint Ventures, the audited Consolidated FinancialStatements are provided in the Annual Report.

Subsidiaries

In accordance with the general circular issued by the Ministry of Corporate Affairs,Government of India, the Balance Sheet, Profit and Loss Account and other documents of thesubsidiary companies are not being attached with the Balance Sheet of the Company. TheCompany will make available the Annual Accounts of the subsidiary companies and therelated detailed information to any member of the Company who may be interested inobtaining the same. The annual accounts of the subsidiary companies will also be kept openfor inspection at the Registered Office of the Company and that of the respectivesubsidiary companies. The Consolidated Financial Statements presented by the Companyinclude the financial results of its subsidiary companies.

Details of major subsidiaries of the Company are covered in Management’sDiscussion and Analysis Report forming part of the Annual Report.

Directors

Shri Ramaniklal H. Ambani, Shri Nikhil R. Meswani, Prof. Ashok Misra and Shri YogendraP. Trivedi, Directors, retire by rotation and being eligible, offer themselves forreappointment at the ensuing Annual General Meeting.

Group

Pursuant to intimation from the Promoters, the names of the Promoters and entitiescomprising the ‘group’ are disclosed in the Annual Report for the purpose of theSEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997.

Directors’ Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, withrespect to Directors’ Responsibility Statement, it is hereby confirmed that :

(i) in the preparation of the annual accounts for the year ended March 31, 2011, theapplicable accounting standards read with requirements set out under Schedule VI to theCompanies Act, 1956, have been followed and there are no material departures from thesame;

(ii) the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31, 2011 and of the profit ofthe Company for the year ended on that date;

(iii) the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act, 1956for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities; and

(iv) the Directors have prepared the annual accounts of the Company on a ‘goingconcern’ basis.

Auditors and Auditors’ Report

M/s. Chaturvedi & Shah, Chartered Accountants, M/s. Deloitte Haskins & Sells,Chartered Accountants and M/s. Rajendra & Co., Chartered Accountants, StatutoryAuditors of the Company, hold office until the conclusion of the ensuing Annual GeneralMeeting and are eligible for reappointment.

The Company has received letters from all of them to the effect that theirreappointment, if made, would be within the prescribed limits under Section 224(1B) of the

Companies Act, 1956 and that they are not disqualified for reappointment within themeaning of Section 226 of the said Act.

The Notes on Accounts referred to in the Auditors’ Report are self-explanatory anddo not call for any further comments.

CostAuditors

The Central Government has approved the appointment of the following cost auditors forconducting Cost Audit for the financial year 2010-11 –(i) For the textiles business -M/s. Kiran J. Mehta & Co, Cost Accountant; (ii) For the chemicals business – ShriS. N. Bavadekar, Cost Accountant, M/s. V. J. Talati & Co., Cost Accountants, M/s.Diwanji & Associates, Cost Accountants, M/s. K. G. Goyal & Associates, CostAccountants; and (iii) For the polyester business – Shri Suresh D. Shenoy, CostAccountant, M/s. V. Kumar & Associates, Cost Accountants.

SecretarialAudit Report

As a measure of good corporate governance practice, the Board of Directors of theCompany appointed Dr. K.R. Chandratre, Practicing Company Secretary, to conductSecretarial Audit of records and documents of the Company. The Secretarial Audit Reportfor the financial year ended March 31, 2011, is provided in the Annual Report.

The Secretarial Audit Report confirms that the Company has complied with all theapplicable provisions of the Companies Act, 1956, Depositories Act, 1996, ListingAgreements with the Stock Exchanges, Securities Contracts (Regulation) Act, 1956 and allthe Regulations and Guidelines of SEBI as applicable to the Company, including theSecurities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers)Regulations, 1997, the Securities and Exchange Board of India (Prohibition of InsiderTrading) Regulations, 1992 and the Securities and Exchange Board of India (Employee StockOption Scheme and Employee Stock Purchase Scheme) Guidelines, 1999.

Particulars of Employees

In terms of the provisions of Section 217(2A) of the Companies Act, 1956, read with theCompanies (Particulars of Employees) Rules, 1975 as amended, the names and otherparticulars of the employees are set out in the annexure to the Directors’ Report.Having regard to the provisions of Section 219(1)(b)(iv) of the said Act, the AnnualReport excluding the aforesaid information is being sent to all the members of the Companyand others entitled thereto. Any member interested in obtaining such particulars may writeto the Company Secretary at the registered office of the Company.

Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars relating to energy conservation, technology absorption, foreignexchange earnings and outgo, as required to be disclosed under Section 217(1)(e) of theCompanies Act, 1956 read with the Companies (Disclosure of Particulars in the Report ofBoard of Directors) Rules, 1988 are provided in the Annexure-I to this Report.

Transfer of amounts to Investor Education and Protection Fund

Pursuant to the provisions of Section 205A(5) of the Companies Act, 1956, dividends,interest on debentures and matured debentures which remained unpaid or unclaimed for aperiod of 7 years have been transferred by the Company to the Investor Education andProtection Fund.

Corporate Governance

The Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance requirements set out by SEBI. The Company has alsoimplemented several best corporate governance practices as prevalent globally.

The Report on Corporate Governance as stipulated under Clause 49 of the ListingAgreement forms part of the Annual Report.

The requisite Certificate from the Auditors of the Company confirming compliance withthe conditions of Corporate Governance as stipulated under the aforesaid Clause 49, isattached to this Report.

Acknowledgement

Your Directors would like to express their appreciation for the assistance andco-operation received from the financial institutions, banks, Government authorities,customers, vendors and members during the year under review. Your Directors also wish toplace on record their deep sense of appreciation for the committed services by theexecutives, staff and workers of the Company.

For and on behalf of the Board of Directors

Mukesh D. Ambani

Chairman and Managing Director

April 21, 2011

Particulars required under the Companies (Disclosure of Particulars in the Report ofthe Board of Directors) Rules, 1988 A. Conservation of Energy (a) Energy conservationmeasures taken: Major energy conservation measures carried out during the year 2010-11are listed below:

• Installation of Awwa nozzles on spinning machines leading to reduction incompressed air consumption.

• Recycling of filter water and cooling water.

• Installation of capacitor on HT circuit, leading to improvement in power factor.

• In order to utilize wind energy 45 Eco-ventilators were provided at variouslocations in the plant to improve the working atmosphere and reduce the heat load.

Fans were provided at Draw line roof, Ware house and DG roof.

• Energy efficient motors were provided at Husk Boiler ESP (ElectrostaticPrecipitator) unit. Total seven motors were replaced.

• A Solar system Geyser installed and commissioned at canteen for hot water use.

• One solar light has been installed and commissioned at road side, outside themain gate.

• At Nitrogen Plant one line has been fabricated and installed, this has resultedinto Stoppage of Nitrogen purge compressor.

• Realized energy savings by optimization of Gas Turbine load byimplementation of Export-Import tieline control at Captive Power Plant (CPP).

• Achieved water savings by reduction in water to monomer ratio at Poly VinylChloride (PVC) plant.

• Reduction in energy consumption by distillation vent steam utilization atUltra-high-molecular-weight polyethylene (UHMW) – HDPE II (High Density PolyEthylene) plant.

• Reduction in effluent generation by replacing 5% Caustic with 32% Caustic for pHcontrol at Vinyl Chloride Monomer (VCM) plant.

• Reduction in energy consumption by providing isolation valve in High Pressure(HP) steam header in Phase-I at CPP.

• Uprading Gas Turbine (GT) capability of GT-3 and GT-5 at Captive Power Plant& Utilities (CPP&U).

• Installation of additional motor driven BFW Pump (B-900) and stoppage of BoilerFeed Pump Turbine (BFPT) at Cracker Plant to achieve energy savings.

• Replacing Existing bowed Super Heater (SH) modules of Heat Recovery SteamGenerator (HRSG) #1 and 2 with drainable and finned super heaters.

• Reduction in steam and power consumption by reducing the water/Aqueous EO(Ethylene Oxide) ratio in glycol reactors at Mono Ethylene Glycol (MEG) plant.

• Piping / Process modification in Condensate Trim Cooler (EA 1553) heat exchangerscheme to improve energy performance and reliability at CPP&U.

• Improvement in Waste heat recovery performance of (Make up water heater) MUWH# 3and MUWH#5 at CPP&U plant.

• Hiboil reflux ratio optimization at Vinyl Chloride Monomer (VCM) plant.

• Maximizing loading on Recycle Ethylene Di-Chloride (REDC) column and minimizingon HB column to reduce SIP consumption by 1.0 Tonnes Per Hour (TPH) and Reflux flowoptimization in REDC column.

• Increase in Purified Terephthalic Acid (PTA)-3 Process Air Compressor (PAC)power export.

• Reduction in energy consumption by installation of inverter for chilledwater pump.

• Stopped one exhaust blower of Draw Machine # 3 to conserve energy.

• Reduction in specific steam consumption in Draw Machine # 1, 2 & 5.

• Reduction in specific power consumption in Draw Machine # 2 & 5.

• Improvement in heat recovery in Amine Treating by replacing shell and tubeheat exchanger with new plate-frame type.

• Reduction of Low Pressure (LP) steam consumption in Amine treating Units by thereduction of lean amine circulation rate.

• Optimization of Coker FGRS (Flare Gas Recovery System). MP steam consumption inejector reduced and Flare loss reduction by optimizing operating parameters.

• Improvement in centrifugal air compressor’s efficiency. Inter-stage coolerbundles replaced with phenolic coated tube bundles to minimize fouling.

Implemented in 4 out of 6 compressors.

• Installation of Heat exchanger in Cracked Naphtha Hydro Treaters (CNHT) torecover naphtha splitter Overhead stream heat. Earlier it was routed directly to fin fancooler.

• Improvement of Ortho Xylene (OX) and Heavy Aromatics (HA) column reboiler heaterefficiencies by online cleaning of radiant section.

• Steam Leak reduction. Steam leak survey carried out across the complex.Identified source of leak arrested.

• Fuel saving by improvement in steam load distribution. Steam generation load onHRSG maximized and load on auxiliary boiler reduced. Heat rate lower for HRSG.

• Propylene Treater Regeneration Sequence Modification in Propylene Recovery Unit(PRU) to avoid Propylene loss.

• Power saving in Pumps and compressors by optimizing process parameters.

• Reduction in LP Steam dumping by taking following measures:-

a) Changing over the process unit turbines to motor driven in Crude / Vaccum Gas Oil(VGO) High Tension (HT) / Coker / Clean Fuels (CFP) Complex.

b) Reducing the LP Steam generation in Diesel Hydrodesulphurisation (DHDS) -1/2

c) VGO HT-3 S-18 Steam generator bypass.

• Zero main flare achievement on continuous basis by

a) Arresting the leakages in Hydrogen Complex.

b) Implementation of Energy conservation schemes in Alkylation Unit (Refrigerationcompressor seal modification).

c) Implementation of Energy conservation scheme in Flare Gas Recovery Unit (Additional30" suction piping for the flare gas recovery compressor). d) Implementation ofEnergy conservation scheme at Propylene Recovery Unit (PRU) [PRU regeneration gases to LowLow Pressure (LLP) flare].

• Minimization of H2 flaring / H2 to FG by product pressure-feed control scheme aswell as integration of SEZ and DTA hydrogen complex.

• Running only 3 air compressors in place of 4 in utility complex.

• Routing of regeneration gases (high N2 conc.) to LLP

Flare in PRU.

• Reduced energy consumption by replacement of old Beacon make Chilled WaterPumps with Grundfos make new energy efficient pumps –Two Nos.

• Reduced energy consumption by replacement of Vertical Turbine pump withSubmersible pump at River Intake Well resulting in stoppage of water lubrication pump.

Nagothane Manufacturing Division

• Stopping of DM water pump to process plants and utilizing the excesscapacity available in DM water supplying to CPP.

• Stopping of both vent absorber (C-05 and C-20) tails pump (P-95 and P-56) byrerouting of tails to stripper through different nozzle and utilize stripper vacuum.

• Installation of New Plug flow Steamer (FB501) for hydrocarbon stripping fromPolypropylene (PP) powder.

• Replacement has been done of 2 nos. Bore-well Pumps with Energy EfficientPumps.

• Corrocoating of Cooling Water pumps in Linear Alkyl Benzene (LAB) and PTAPlants.

• Chemical cleaning of Convection Bank Heater Tubes in Paraxylene Plant.

• Ceramic coating on Heater Tubes in Paraxylene Plant.

• Use of Aerofoil designed Fibre-reinforced plastic (FRP) blades for coolingtower fans. Scheme was implemented in two cooling towers i.e. N2O2 (1 fan) and A CNcooling tower (1 fan). In addition to that A CN cooling tower internals were replacedresulting in reduction in make up water by 4.5 m3/hr.

• Blocking of muffle block inside burner assembly for 4 burners of Hot Oil heater,LAB plant, resulted in saving of Fuel Gas.

• Reduction in excess Oxygen in flue gas in H-106, of Naphtha Cracker Plant (NCP),from 4.0% to 2.4% by 4 burner blank off lowered the fuel gas consumption significantly.

• Reduction in HF inventory by Single Reactor settler trial led to power savingdue to stopping of one pump.

• Installation of Energy Efficient Retrofit Metal halides/ Compact FluorescentLamp (CFL) in place of the conventional lighting was done to reduce power consumption.

• VCM EDC (Ethylene Dichloride) Cracker Stack temperature and excess Oxygen (O2)reduction was done with the help of Damper adjustment.

• Insulation Health check was carried out for Out Side Battery Limited (OSBL)steam header. Insulation repair work was done for HP and MP header.

• Reduction in Hot Oil circulation flow from 145M3/Hr to 120M3/Hr in LAB.

• Stripper column bottom 2 pump was operated for reduction in Chemical OxygenDemand (COD) in A CN plant.

• Improvement in heat recovery by increase in residue gas exchanger area atGas Cracker plant.

• Improvement in heat recovery by installation of new E 521 exchanger at MEGplant.

• Reduction in power demand by installation of hydraulic Turbine at Ethane-PropaneRecovery Unit (EPRU).

• Recovery of heat energy by replacing exchanger E 624 which a shell and tube typeexchanger with a plate type heat exchanger and rerouting of recycle water through it.

• Energy savings by supplying LP ethylene to VCM from Gas Cracker Unit (GCU). Thiswill reduce the refrigeration load on compressors C2R and C3R at Gas cracker plant.

• Steam savings by cent rate water heat recovery at PVC.

• Provision of Glycol ejector in place of steam ejectors in CP-2/3 atPartially Oriented Yarn (POY) plant.

• Improvement in run length of Gasoline Hydrogenation Unit (GHU) 1^ststage reactor with replacement of catalyst with Ni catalyst at cracker plant and reducingno. of regenerations of GHU 1^st stage reactor from 4 to 2 regenerations.

• Reduction in energy consumption by installation of Uninterrupted PowerSupply (UPS) for Plant lighting system.

• Reduction in energy consumption by stopping return air blower of POY quenchesAir Handling Unit (AHU).

• Reduction of energy consumption by installing inverter on Raw water /Coolingwater pump

• In LPG recovery improvement scheme across Re-contact Drum (RCD) loop, underthe scheme of routing separator liquid to recovery plus unit, stoppage of two pumps atRecovery plus can save 300 kW power which could be Rs 1.29 crore /annum.

• Provisions of new 8" bypass line to LP Steam generator S-18 in VGO HT-4Unit.

• Reduction of MP steam by re-routing Light Coker Gas Oil (LCGO) pump around tostripper re-boiler in Coker-2.

• Replacement of MP steam by LP steam in Fluidized Catalystic Cracker (FCC)reactor stripper using thermo-compressor.

• Replacement of 12 nos. centrifugal pumps with high efficiency pumps.

• Anti Corrocoat coating is to be applied to all cooling water pumps toimprove efficiency.

• Energy Saving by replacing Old Inefficient Electrical Motors by EnergyEfficient Motors.

• Gas Conversion of Stenters in Menswear Process House from Gas Fired ThermicFluid Heating.

• Augmentation of Humidification Systems in Worsted Spinning.

• Corrocoating of Cooling Water pumps in Energy Center and Utility Plants.

• Installation of Heat Pipe Heat Exchanger (HPHE) in Bertram Heater (Dow Vaporservice) and CP6 Heater (Dow Liquid service) of Utility Plant.

• Providing efficient Air Intermingling Jets in TORAY

FDY Plant.

• Improved Steam traps management.

• Heat recovery scheme of EO column bottom and EO stripper bottom to preheatCycle gas going to Contactor.

• Proposal to preheat the feed for Low boiler Tower (T-410) with the overheadproduct stream of High Boiler Tower (T-420) in PBR1 plant is under conceptual stage.

Preheating for Feed to T-410 column with bottom product is also under consideration.

• Steam Network audit on regular basis to identify, quantify and control steamleak through valves, pin hole and traps.

• Installation of Variable Frequency Drive (VFD) in Induced Draft (ID) and FD fansof LAB heater.

• In PBR2 plant, Condensate flashing by reducing the condensate drum pressure(V-152) to 1.2 Kg/cm2 g resulting in additional heat recovery.

• LAB plant, Pacol Compressor motor replacement to avoid the Gear Box resulting inpower saving.

• Recovery of H2 rich gas during reduction of PGH 1st stage reactor.

• By arresting the Flue gas losses through the by-pass stacks of GT’s andInsulation health check, the energy loss will be prevented.

• GT2 output improvement by 7.5% and heat rate reduction by 2%. This will beachieved by up-rating the gas turbine major components.

• Reduction in compressed air consumption due to installation of Awwa nozzleson spinning machines has resulted savings of Rs. 12.46 lacs per annum.

• Savings of Rs. 8.93 lacs per annum has been achieved due to recycling offiltered water and cooling water.

• Installation of capacitor on HT circuit leading to improvement in power factorand realized savings of Rs. 4.63 lacs per year.

• In order to utilize wind energy 45 Eco-ventilators were provided at variouslocations in the plant to improve the working atmosphere and reduce the heat load.

Fans were provided at Draw line roof, Ware house and DG roof.

• Energy efficient motors were provided at Husk Boiler ESP unit. Total sevenmotors were replaced.

• A Solar system Geyser installed and commissioned at canteen for hot water use.

• One solar light has been installed and commissioned at road side, outside themain gate.

• At Nitrogen Plant one line has been fabricated and installed this has resultedinto Stoppage of Nitrogen purge compressor.

• All the above energy conservation measures has resulted savings of Rs. 0.85 lacsper year.

• Total annual savings worth Rs. 2.89 crore has been achieved onimplementation of energy saving schemes as indicated in Section (a).

• Estimated savings worth Rs. 92 lacs per year can be achieved by increase inresidue gas exchanger area for better heat recovery at Gas cracker plant.

• Estimated savings worth Rs. 46 lacs per year can be achieved by installation ofnew E 521 exchanger for better heat recovery at MEG plant.

• Estimated savings worth Rs. 78 lacs per year can be achieved by installation ofhydraulic Turbine at EPRU.

• Recovery of heat energy, worth Rs. 87 lacs per year, can be achieved byreplacing exchanger E 624 which a shell and tube type exchanger with a plate type heatexchanger and rerouting of recycle water through it.

• Energy savings worth Rs. 119 lacs per year can be achieved by supplying LPethylene to VCM from GCU.

This will reduce the refrigeration load on compressors C2R and C3R at Gas crackerplant.

• Estimated saving worth Rs. 53 lacs can be achieved by savings steam by centratewater heat recovery at Poly Vinyl Chloride (PVC) plant.

• Uprading Gas turbine capability of GT-3 and GT-5 at CPP&U. (Savings: Rs.14.19 crore approx.)

• Installation of additional motor driven Boiler Feed Water (BFW) Pump (B-900) andstoppage of BFPT at Cracker plant to achieve energy savings. (Savings: Rs. 8.21 croreapprox.)

• Replacing Existing bowed SH modules of HRSG#1 and 2 with drainable and finnedsuper heaters. (Savings: Rs. 7.05 crore approx.)

• Reduction in steam and power consumption by reducing the water/Aqueous EO ratioin glycol reactors at MEG plant. (Savings: Rs. 3.54 crore approx.)

• Piping / Process modification in Condensate Trim Cooler (EA 1553) heat exchangerscheme to improve energy performance and reliability at CPP&U. (Savings: Rs. 3.77crore approx.)

• Improvement in Waste heat recovery performance of (Make up water heater) MUWH# 3and MUWH#5 at CPP&U plant. (Savings: Rs. 2.45 crore approx.)

• Hiboil reflux ratio optimization at VCM plant. (Savings: Rs. 1.30 crore approx.)

• Maximizing loading on REDC column and minimizing on HB column to reduce SIPconsumption by 1.0 TPH and Reflux flow optimization in REDC column. (Savings: Rs. 1.13crore approx.)

• Increase in PTA-3 PAC power export. (Savings: Rs. 0.91 crore approx.)

• Provision of Glycol ejector in place of steam ejectors in CP-2/3 at POY plant.(Anticipated Savings: Rs. 2.50 crore approx.)

• Improvement in run length of GHU 1^st stage reactor with replacementof catalyst with Ni catalyst at cracker plant and reducing no. of regenerations of GHU 1^ststage reactor from 4 to 2 regenerations. (Anticipated Savings: Rs. 0.42 croreapprox.)

• Savings of Rs. 2.47 crore made by optimizing steam consumption.

• Savings of Rs. 57 lacs were made by taking various energy conservation measuressuch as Installed inverter for chilled water pump, Stopped one no. exhaust blower of DrawMachine # 3, Reduction in specific power consumption in Draw Machine # 2 & 5.

• Estimated savings of Rs. 4.9 lacs per year can be achieved by installing UPS forplant lighting system.

• Estimated savings of Rs. 9.7 lacs per year can be achieved by stopping returnblower of POY quench AHU.

• Estimated savings of Rs. 2.2 lacs per year can be achieved by installinginverter on Raw water/ Cooling water pump.

• Improvement in heat recovery in Amine Treating Unit-4 by replacing shell andtube heat exchanger with new plate- frame type rich/lean amine heat exchanger, saving 7TPH LP Steam (saving Rs. 4.7 crore / annum).

• Reduction of LP steam consumption by 10 TPH in Amine treating Units by thereduction of lean amine circulation rate (Saving Rs. 6.95 crore / annum).

• Optimization of Coker FGRS system to reduce MP steam consumption by 1.25 TPH andFlare loss reduction by 6 Month Till Date (MTD) (saving Rs. 6.02 crore / annum).

• Improvement of centrifugal air compressor’s 6, 7, 8 and 9 efficiency in DTAUtilities by the replacement of inter-stage coolers with phenolic coated tube bundles inall the compressors one by one, reduction of power consumption by 1245 KWhr. (saving Rs.5.35 crore / annum).

• Installation of S03 stripper feed Heat exchanger in CNHT to recover naphthasplitter OVHD stream heat which is going to fin fan cooler A01, saving 6 MTD of Fuel gas(saving Rs. 4.91 crore / annum).

• Improvement of OX and HA column reboiler heater efficiencies by radiant sectiononline cleaning, saving 3.47 MTD of Fuel Gas (saving Rs. 2.84 crore / annum).

• Steam Leak reduction by survey across the complex conducted by energy cell,saved 4 TPH LP steam (saving Rs. 2.67 crore / annum).

• Fuel saving by load improvement in HRSG 1 and 5, saving 1 MTD fuel (saving Rs.0.82 crore / annum).

• Propylene Treater Regeneration Sequence Modification in PRU to avoid Propyleneloss in Flare at the beginning of regeneration, reduction of flare loss by 1 MTD (savingRs. 0.23 crore / annum).

• Power saving in LNUU Recycle gas compressor by optimizing Gas to Oil Ratio,saving power of 150 KWhr (saving Rs. 0.64 crore / annum).

• Power saving by stopping of one out of two in Tatoray stripper bottom pumps,saving power of 50 KWhr (saving Rs. 0.215 crore / annum).

• Power saving in HMU-1 due to increase in efficiency of RFG compressor byproviding new tube bundle with additional baffles in Inter stage cooler, saving 14 KWhrpower (savings Rs. 0.06 crore / annum).

• Energy savings worth Rs. 1714.3 lacs per year has been achieved by reducingLP steam dumping from 84 to 50 TPH.

• Achieved hydrocarbon saving of 31 TPD by recovering all hydrocarbons released toflare header.

There is zero flaring from Main flare now (savings Rs. 1150.7 lacs per annum).

• Achieved 18.9 TPD saving of fuel by reducing H2 getting lost in fuel gas(savings Rs. 701.5 lacs per annum).

• Achieved 12.2 TPD of fuel savings by running only 3 compressors in utility(savings Rs. 450.9 lacs per annum).

• Achieved 2.1 TPD savings of fuel by recovery of regeneration gases by routingthem to LLP flare (savings Rs. 77.9 lacs per annum).

• An estimated energy saving quantity of 26.4 TPD (Rs. 970.6 lacs per year) offuel by providing a bypass to LP steam generator can be achieved.

• Energy savings worth Rs. 534.5 lacs per year can be achieved by re-routing LCGOpump around to stripper re-boiler in Coker-2.

• Energy savings worth Rs 979.9 lacs per year can be achieved by replacement of MPsteam by LP steam in FCC reactor stripper using thermo-compressor.

• Energy savings worth Rs. 81.3 lacs per year can be achieved by routing ventgases from degassing column to FG header.

• Savings of Rs. 4.5 lacs per year achieved due to reduced energy consumptionby replacement of old Beacon make Chilled Water Pumps with Grundfos make new energyefficient pumps –Two Nos.

• Savings of Rs. 1.0 lacs per year achieved due to reduced energy consumption byreplacement of Vertical Turbine pump with Submersible pump at River Intake Well resultingin stoppage of water lubrication pump.

• Estimated saving worth Rs. 12 lacs per year can be achieved by replacement of 12nos. centrifugal pumps with high efficiency pumps.

• Energy savings worth Rs. 7.10 lacs per year has been achieved by stoppingthe DM water pump supplying water to process plants. (Power Savings is 30 KW per Hour @Rs. 2.7 per KWH )

• Stopping of both vent absorber (C-05 and C-20) tails pump (P-95 and P-56) byrerouting of tails to stripper through different nozzle and utilize stripper vacuum hasresulted energy saving worth Rs. 0.61 lacs per annum. (Power savings is 2.6 KW per hour @Rs.2.7 per KWH)

• Reduced steam consumption by Installation of New Plug flow Steamer (FB501) forhydrocarbon stripping from PP powder. This has achieved energy savings worth Rs. 10.51lacs per year. (Steam savings is 300 Kgs per Hour. Considering a cost of Rs.400 per MT theannual savings is Rs.10.51 lacs)

• Energy savings worth Rs. 16.60 lacs per year has been achieved byreplacement of 2 nos. Bore-well Pumps with Energy Efficient Pumps.

• Estimated Energy Saving worth Rs. 83.67 lacs per year can be achieved byreplacing Old Inefficient Electrical Motors by Energy Efficient Motors.

• Energy Saving worth Rs. 47.33 lacs per year can be achieved by Gas Conversion ofStenters in Menswear Process House from Gas Fired Thermic Fluid Heating.

• Estimated Energy Saving worth Rs. 62.34 lacs per year can be achieved byaugmentation of Humidification Systems in Worsted Spinning.

• Energy savings worth Rs.19 lacs per year has been achieved by efficiencyimprovement on Corrocoating of Cooling water pumps in LAB and PTA plants.

• Energy savings worth Rs.16 lacs per year achieved by chemical cleaning ofConvection Bank Tubes in Paraxylene Heater (D5001).

• Energy savings worth Rs.30 lacs per year can be achieved by providing efficientIntermingling Jets in TORAY FDY plant.

• Energy Saving worth Rs. 30 lacs per year can be achieved by installation of HPHEexchanger in Bertram and CP 6 Dow heaters.

• Savings realized due to blocking of muffle burner block in Hot Oil heater ofLAB plant, savings to the tune of Rs. 45 lacs/annum have been realized. In addition tothat stack damper adjustment of EDC cracker furnace has lead to Rs. 40 lacs saving.

Likewise, blocking of 4 burner blocks in H-106 helped in reducing the excess O2 in fluegas from 4 to 2.4% and a saving of Rs. 33 lacs/annum. Thus, total Energy savings worth Rs.161 lacs have been realized.

1. Specific areas in which the research and development (R&D) is beingcarried out by the Company

• Development of in-house additives for increase in propylene yield influidized catalytic cracker (FCC).

• Selection of lower cost FCC catalysts and additives for improved conversion andyields.

• Processing of cheaper and heavier varieties of crude to widen the crude blendswindow.

• Propylene yield improvements and benzene reduction in refining.

• Desalter operation improvements.

• Computational fluid dynamics (CFD) studies for plant trouble shooting.

• Molecular compositional blending models.

• Polypropylene quality control.

• Coker streams processing in FCC.

• Studies to produce good quality feedstock for carbon black industry.

• Heterogeneous catalysis for hydrocarbon transformations.

• Homogeneous catalysis for specific organic synthesis.

• Development of adsorbents and adsorption processes.

• Development of catalysts for polymerization of ethylene and butadiene.

• Polymer based specialty products development.

• Chemical and microbial treatment of effluent water.

• Development of model for simulated moving bed processes.

• Development of dehydrogenation catalyst for linear alkyl benzene (LAB).

• Polyolefin inorganic precursor technology development.

• High performance polypropylene (PP) homo and impact copolymers (ICP) gradescatalyst technology.

• Development of high performance additives for polyolefins.

• Development of catalytic process for on purpose 1-hexene.

• Development of morphologically controlled catalyst for producing HDPE grades.

• Development of clarifiers for PP grades.

• Development of reactor grade thermo plastic olefins (TPO).

• Development of high flow high stiffness PP grades.

• New co-catalyst systems for enhancing bottle-grade resin productivity.

• Barrier property enhancement for polyethylene terephthalate (PET) resin.

• Development of PET with new additive for cost reduction and color improvement.

• Development of yarn from alternate polyester (Polytrimethylene terephthalate,Polybutylene terephthalate).

• Productivity enhancement through polymer modification.

• Asbestos replacement in cement sheets.

• Indigenous spin finish development for various products.

• Development of anti-pill polyester, elastic polyester, low melt polyester, lowcost flame retardant polyester , low antimony/antimony free polyester, full dull/cottonlook polyester fiber, hollow and bulky fibers, and super micro denier polyester staplefiber.

• Development of PolyVinyl Chloride (PVC) separation techniques in PET recycling.

2. Benefits derived as a result of the above R&D

• Potential benefit of Rs. 50 crore/annum for additional extraction of benzenefrom light reformate, which also helped in reducing the benzene content of gasoline inrefinery.

• Rs. 20 crore/annum from additional propylene recovery in the FCC unit inrefinery.

• Rs.12 crore/annum saved on design and downtime costs in refinery coker heaterthrough CFD modeling.

• Rs. 35 crore/annum by demonstrating capability to process additional coker LPGin the refinery propylene recovery unit.

• Potential benefits of ~ Rs. 58 crore/annum from polyester R&D projects.

3. Future plan of action

• Hydro-processing catalyst development and evaluation.

• Creation of coker pilot plant / related facilities.

• Catalyst development for improving FCC profitability.

• Development of process for widening of crude window.

• High throughput facilities for catalyst development and evaluation.

• CFD studies for reliability improvement.

• Molecular characterization of crude and refinery streams.

• Reduction of impurities in propylene stream.

• Advanced catalyst characterization facilities.

• Process for chlorination of polyvinyl chloride (PVC) to produce chlorinatedpolyvinyl chloride (CPVC).

• Process for purified terephthalic acid (PTA) from inexpensive raw material.

• Development of reforming catalyst for xylenes production.

• Development of ethyl benzene dealkylation catalyst for aromatics plant.

• Specialty chemicals from C8 olefin mixture streams.

• Development of transalkylation catalyst for production of C8 aromatics.

• Adsorbent for separation of xylene isomers form C8 aromatics.

• Microbial and photocatalytic processes for effluent treatment.

• Anticoking additives for thermal cracking of hydrocarbons.

• Oxidation catalysis.

• Micro-meso porous and nano-materials for catalysis applications.

• Development of super absorbent polymers.

• Functionalized polybutadiene rubber (PBR) based rubber products.

• Development of PP grades for foamed products.

• Inorganic materials from spent catalysts.

• Implementation of newly developed polyester bottle grade co-catalyst for fiberand filament application.

• Development of extrusion blow moulding grade PET.

• Improvement of productivity/tenacity in super high tenacity polyester.

• Development of ‘New generation spinnerets’ for

productivity increase and functional enhancements.

• Development of eco-friendly/green partially oriented yarn (POY).

• Up-scaling of moisture management yarns.

• Exploring the application of polyester in various segments/products.

4. Expenditure on R & D

d) Total R & D expenditure is 0.2% of total turnover.

1. Efforts, in brief, made towards technology absorption, adoption andinnovation:

• Selection of better catalysts and additives for FCC using pilot plantfacilities.

• Technology development for processing cheaper and heavier crudes to widen thecrude blends window.

• Enhancing propylene recovery in refinery.

• Technical support for marketing of FCC spent catalysts.

• High capacity revamps in paraxylene plants.

• Adsorbent change in paraxylene plants.

• Innovative method for increasing benzene /olefin ratio in alkylation at linearalkyl benzene (LAB) plant.

• Enhancing low density polyethylene (LDPE) plant capacity.

• Development of alternate co-catalyst for producing high density polyethylene(HDPE).

• Enhancing butene recovery in solution polymerization PE plant.

• Linear low density polyethylene (LLDPE) plant capacity enhancement by innovativemethods.

• Improve quality of polymer grade butene.

• Development of specialty PP grades for foamed products.

• Food grade hexane (FGH) and polymer grade hexane (PGH).

• Startup of bottle to bottle (B2B), PET recycling project.

• Polyester staple fiber (PSF) based product to improve the shelf life of fruitsand vegetables in ambient storage conditions.

• Increased productivity and color enhancement through commercialization of newco-catalyst on continuous bottle-grade resin plants.

• Spinning productivity enhancement through application of in-house developedtechnology.

• Low shrinkage industrial yarn through in-house hardware modification.

• Development of environment friendly ‘silicone spray system’ for wipingof spinnerets.

• Improved and low cost spin finish development for polyester products.

• Debottlenecking of polyester filament yarn (PFY) machines for super coarsedeniers.

• In-house technology development for anti pill polyester.

• Development of super micro denier polyester staple fibre.

• Production of dope dyed PSF through recycle route.

• Development of high shrink PSF.

2. Benefits derived as a result of the above efforts

• Increase in propylene yield with new catalyst based on pilot plant studies.

• Reduction in import of low sulphur residue feedstock in refinery.

• Rs. 3 crore on additional sales of FCC spent catalyst.

• Potential benefit of ~ Rs. 167 crore/annum by high capacity revamps andadsorbent change in paraxylene plants.

• Benefits of ~ Rs. 32 crore/annum from polyester R&D projects.

3. Information regarding Imported Technology

(f) Activities relating to export, initiatives to increase exports, Developments of newexport markets for Products and Services and Export Plan

The Company has continued to maintain focus and avail of export opportunities based oneconomic considerations. During the year, the Company has exports (FOB value) worth Rs.1,46,667 crore (US$ 32,889 million).

(g) Total Foreign exchange earned and used

Form for disclosure of particulars with respect to conservation of energy Part‘A’

B. Consumption per unit of Production

For and on behalf of the Board of Directors

Mukesh D. Ambani

Chairman and Managing Director

April 21, 2011

Auditors’ Certificate on Corporate Governance

To the Members,

Reliance Industries Limited

We have examined the compliance of conditions of Corporate Governance by RelianceIndustries Limited, for the year ended on 31st March 2011, as stipulated in Clause 49 ofthe Listing Agreement of the said Company with stock exchanges.

The compliance of conditions of Corporate Governance is the responsibility of theManagement. Our examination has been limited to a review of the procedures andimplementation thereof adopted by the Company for ensuring compliance with the conditionsof the Corporate Governance as stipulated in the said Clause. It is neither an audit noran expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanationsgiven to us and based on the representations made by the Directors and the Management, wecertify that the Company has complied with the conditions of Corporate Governance asstipulated in Clause 49 of the above-mentioned Listing Agreement.

We state that such compliance is neither an assurance as to future viability of theCompany nor of the efficiency or effectiveness with which the management has conducted theaffairs of the Company.

Name of the Entity

1 Aavaran Textiles Private Limited

2 Anuprabha Commercials Private Limited

3 Deccan Finvest Private Limited

4 Ekansha Enterprise Private Limited

5 Farm Enterprises Limited

6 Futura Commercials Private Limited

7 Jagadanand Investments And Trading

Company Private Limited

8 Jagdishvar Investments And Trading Company Private Limited

9 Kankhal Investments And Trading Company

Private Limited

10 Kardam Commercials Private Limited

11 Kedareshwar Investments And Trading Company Private Limited

12 Krish Commercials Private Limited

13 Kshitij Commercials Private Limited

14 Madhuban Merchandise Private Limited

15 Neutron Enterprises Private Limited

16 Nitya Priya Commercials Private Limited

17 Pams Investments And Trading Company Private Limited

18 Petroleum Trust

19 Priyash Commercials Private Limited

20 Reliance Aromatics and Petrochemicals Limited

21 Reliance Chemicals Limited

22 Reliance Consolidated Enterprises Private Limited

23 Reliance Consultancy Services Private Limited

24 Reliance Energy and Project Development Limited

25 Reliance Global Commercial Limited

26 Reliance Industrial Infrastructure Limited

27 Reliance Petroinvestments Limited

28 Reliance Polyolefins Limited

29 Reliance Ports and Terminals Limited

30 Reliance Universal Commercial Limited

31 Reliance Universal Enterprises Limited

32 Reliance Utilities and Power Private Limited

33 Reliance Utilities Private Limited

34 Reliance Welfare Association

36 Saumya Finance And Leasing Company Private Limited

37 Silvassa Hydrocarbons And Investments Private Limited

38 Sudarshan Enterprises

39 Synergy Synthetics Private Limited

40 Terene Industries Private Limited

41 Vita Investments and Trading Company Private Limited