Economy

Pranab favours aligning fuel prices with global market

Our Bureau New Delhi | Updated on March 12, 2018

Finance to fore: President Pranab Mukherjee and Petroleum Minister S. Jaipal Reddy, at Petrotech 2012 in New Delhi on Monday. — Ramesh Sharma

PETROLEUM PRODUCTS





President Pranab Mukherjee spoke like a finance man on Monday. In his inaugural address at the Petrotech 2012 here, he said: “In the present international environment of rising petroleum prices, greater alignment of prices to global prices is in the interest of both consumers as well as investors.”

Mukherjee’s comment may work as a balm for the Manmohan Singh Government, which has had to face criticism for raising auto fuel prices and capping the number of subsidised LPG cylinders for each household.

Time-bound programme

“Government of India is committed to adopting a time-bound programme to achieve this. I expect the industry to play a helpful role in achieving the Government’s objectives,” the President said.

He added that there must be increased understanding of the fact that the path to a more sustainable future will require society to strike a balance between its energy consumption vis-à-vis its cost and availability.

The President also said the Government was working towards extending fiscal incentives, similar to those provided for exploration of oil, to all forms of natural gas exploration and exploitation. In the present climate of rapid changes in the hydrocarbons sector, the Government’s top priority was to realise the full potential of coal-bed methane, shale gas, underground coal gas, gas hydrates and biofuels, he said.

“The Government is also currently extending full support to companies acquiring overseas oil and gas assets and imports of LNG. It would, in this context, be necessary to accord due priority to the development of a countrywide gas pipeline transportation infrastructure,” he said.

On the growing demand for energy and the challenges arising from resource constraints, he said this calls for a reshape of the energy policy matrix.

“This will definitely happen, gradually and eventually, over the coming decades, but it poses urgent questions today. Our nation’s response and the time that we will need to develop new technologies and reset the overall energy matrix will have to be carefully calibrated. This calls for coordinated action, efficient planning and massive investment,” Mukherjee said.

Just like financial markets, the world energy markets are inherently global and interdependent, and no country can isolate itself from the market. Interdependence is central to energy security, he said.

Strong partnerships

“We need to build strong economic partnerships with other producing countries and their oil and gas industries to the mutual benefit of each other. We should seek to work together with other countries, especially those who are active in the oil and gas sector,” he added.

The Petroleum Minister, S. Jaipal Reddy, said the Government was working towards making oil and gas auctions more attractive. He said that he hoped to have a more finely tuned New Exploration Licensing Policy out in the next few months.

> richa.mishra@thehindu.co.in

Published on October 15, 2012

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