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Hike in fuel prices in January

COIMBATORE: Secretary, Union Ministry of Petroleum and Natural Gas, M.S. Srinivasan said here on Friday that a moderate hike in prices of petroleum products during the first week of January was inevitable.

Talking to mediapersons, Mr. Srinivasan said the Group of Empowered Ministers would meet in the first week of January to finalise the hike.

The estimated under recovery for petroleum corporations during the last year owing to subsidy was Rs. 49,000 crore as against the estimate of Rs. 56,000 crore while this year the Ministry was anticipating it to be around Rs. 75,000 crore.

Mr. Srinivasan said that as per the orders of the Supreme Court in 2004, the Petroleum and Natural Gas Ministry was expediting the project for setting up compressed natural gas (CNG) outlets for auto fuel needs.

The plan was for having these dispensing stations by 2010 in all the 20 cities identified as the most polluted owing to vehicular emission. The pipeline for Natural Gas from the Krishna-Godavari basin that would run for 3,400 km from East to West and East to South would have CNG dispensing stations in towns and cities en route, including Chennai.

Mr. Srinivasan said the much-awaited works for laying a gas pipeline from Tehran to India via Pakistan would begin by March 2008. During the next few months, the bilateral talks between India and Pakistan and then trilateral talks among India, Pakistan and Iran would take place.

He said the gas price and transportation cost had been finalised and what remained to be decided was the transit fee payable to Pakistan.

To a query on whether supply restrictions on LPG refill would help prevent diversion of subsidised domestic LPG cylinders, Mr. Srinivasan said an LPG cylinder costing Rs. 580 a cylinder was sold for domestic needs at Rs. 294, hence the caution of supply restrictions to ensure that the subsidy was not misused.

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