The growth of India’s natural gas sector has been constrained by curbs imposed by pricing and marketing policies of the government, a FICCI-PWC report said last week. The gas sector in India holds tremendous potential.
However, its growth is constrained due to pricing and marketing policies of the government with respect to gas produced domestically, the joint paper titled ‘Rising above the sub-optimal Exploring ways to find energy solutions’ said. The government not just fixes the price of domestically produced gas but also determines who it should be sold to.
Gas produced by PSUs and Reliance Industries is priced at $4.2 per million metric British thermal units (mmbtu), whereas gas produced from some of the blocks has been allowed to be sold at slightly higher rate. This has caused a sense of uncertainty in investors’ minds, it said also identifying absence of market-determined pricing mechanism as a constraint.
Leave a Reply
You must be logged in to post a comment.