NEW DELHI: The finance ministry has backed a thought to cap gas costs from Reliance Industries-run Krishana Godavari fields until the corporate clears “past dues”, setting the stage for the union cabinet to amend its earlier call to double costs from all fields to $8.4 a unit from april.
North Block supported the move by the oil ministry last week once discussing the difficulty internally for many days. In government circles, the change in stance is being seen as a ultimate effort to avoid additional controversy once the Manmohan Singh government sweet-faced flak because it was suspect of providing windfall gains to gas producers.
On its half, the govt. argued that hike, supported costs in world hubs, was necessary within the wake of a rise in international costs.
The government has been suspect of lease RIL go away while not supplying the secure amount of gas from the KG-D6 blocks. Gas output from the 2 main fields has declined around 80th to ten million commonplace cubic metres per day, rather than rising to the planned eighty million commonplace cubic metres per day. The oil ministry had piloted the proposal for associate comprehensive increase in gas worth, disputation that it’ll boost investment within the sector, and facilitate Republic of India overcome shortage. different ministries like finance had played ball. solely power and plant food ministries coping with gas shoppers opposed the move.
The cabinet call, however, had come in for severe criticism, prompting the finance ministry to forward newspaper editorials and seeking oil ministry comments, that then captive a cabinet note suggesting a cap on value for RIL. Initially, the oil ministry had opposed any changes within the cabinet-approved rating policy disputation that the theme ought to be easy to administer. But now, varied choices are being mentioned, as well as the choice of keeping KG-D6 outside the compass of the notification.