India's Hindustan Petroleum Corp (HPCL) plans to start its 9 million tonne-a-year Barmer refinery and petrochemical project in Rajasthan state by January 2024, the oil minister said on Tuesday, helping to cut petrochemical imports.

India, the third biggest oil importer, is expanding refining capacity to meet rising demand for fuel and petrochemical to power economic expansion. India's per capita petrochemical consumption is about a third of the global average.

Oil Minister Hardeep Singh Puri said the project, which covers 4,800 acres, would produce 2.4 million tonnes a year of petrochemicals and cut the annual petrochemical import bill by 260 billion rupees ($3.14 billion).

India's annual imports of petrochemicals were worth about 950 billion rupees, he said.

Most Indian refiners are linking petrochemical plants with refineries as demand for plastics and specialty chemicals rises. Integrating petrochemical plants would also help refiners hedge against slowing demand for conventional fuel in the longer term.

The Barmer refinery and petrochemical project will produce gasoline and gasoil for retail sales and will use naphtha, liquefied petroleum gas and kerosene as feedstock to make petrochemicals.

HPCL's head of refineries, S Bharathan, said his company would look at importing oil from the Middle East to start the project, which will also process 1.5 million tonnes a year of locally produced oil.

The project, in which HPCL has a 74% stake and the Rajasthan government holds the rest, was due to be completed by December 2022 but shutdowns due to the pandemic delayed the plans.

The project cost has risen to 720 billion rupees from the 430 billion rupees estimated in 2018, the minister said.

The Barmer complex, executed by HPCL Rajasthan Refinery Ltd, could double capacity to 18 million tonnes a year, he added.

($1 = 82.7910 Indian rupees) (Reporting by Nidhi Verma; Editing by Edmund Blair)