Khurshid on gas price hike: Hard decision, but will lead to more investments

Srinagar: The central government’s decisionto double gas prices will lead to more investments into oiland gas exploration sectors and help in addressing globalwarming concerns, External Affairs Minister Salman Khurshid

said today.

“At present, we are paying $4.5 for local oil and gaswhile we import at $13. If we do not increase the price

from $4.5 to $6 or $8, which can bring moreinvestments into exploration, then we have to keep on

importing at a higher price and remain dependent on others,“Khurshid said addressing Congress workers at PCC office here.

[caption id=“attachment_914043” align=“alignleft” width=“380”]  AFP[/caption]

He said price hike was not due to inefficiency of thegovernment but because of the fact that India imports 80 percent of its fuel requirements.“If the prices increase, it is not because we are notdoing our job well. It is because we import 80 percent of ourfuel requirements. Today, gas is not only used for domesticpurposes but also used for generating power and operatingfactories and trains,” he said.

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The Cabinet Committee for Economic Affairs yesterdayapproved hiking natural gas price to $8.4 per mmBtu fromthe current $4.2 per mmBtu with effect from April, 2014.

The increase in gas price was opposed by user ministriesof power and fertiliser as it would lead to cost of generatingelectricity spiking to Rs 6.40 per unit from Rs 2.93 andnearly Rs 9,000 crore per annum rise in cost of urea output.

Khurshid said that “it was not an easy decision” as evensome of the allies in the government did not understand it.

“It was not an easy decision. It was a difficult decision… our own partners did not understand this,” he said.

Explaining the rationale behind raising the gas price,Khurshid said India cannot go on using coal for fueling the

thermal power projects as it can isolate the country from restof the world on issue of climate change.

“If we continue to produce electricity using coal(thermal power projects), we will be isolated from the world.

The international community is saying that you (India) alonedoes not have rights over the environment. I went to Chile

where people showed me a 20-year-old photograph and said thesnow-line has receded due to global warming,” he said.

Khurshid said receding snow-line is something happening inIndia as well.

“It is happening here also in the Himalayas. The glaciersare melting and the results can be seen in Uttarakhand. We

have to make arrangements to ensure that the environment isprotected and the temperature does not rise,” he added.

PTI